Due to the favorable market situation, investments in cryptocurrencies with Chinese yuan (CNY) have risen sharply. The Chinese crypto trade is experiencing a comeback after record low and despite bans. This testifies to the ingenuity of the Chinese Bitcoin fans and points to the general focus of the Chinese economy on Bitcoin.
China’s crypto investors are increasingly buying Bitcoin. Coinlib capture of the crypto market results in a total investment of yuan in BTC of $ 164 million over the last 24 hours of the money flow statement.
Yuan’s second largest fiat currency after US dollars
The yuan is the second strongest fiat currency on the market after the US dollar and the Brazilian real. The most yuan is invested in Bitcoin; but also ethers ($ 75 million) and Stellar ($ 19.94 million) benefit from Chinese investment.
Unlimited ban on ICOs and cryptocurrencies, bitcoin mining allowed
Despite increased investment, cryptocurrency trading in China, as well as ICOs, has been banned since 2017. While the state perceives Blockchain and Bitcoin as a tool for administration, innovation and control, the country is trying to prevent investment in decentralized currencies, for instance through network blocking and disclosure requirements. This is justified by the investor protection.
Record low in August 2018
The fact that Chinese crypto trading can not be fully eradicated by regulation has been emphasized by experts since the record low of Chinese crypto investment in August 2018. At that time, the share of Chinese traders in the Bitcoin market was only one percent. In contrast, the yuan contributed more than 90 percent of BTC trading volume before the regulatory wave in the fall of 2017.
With VPN and relocation against surveillance measures
Chinese investors are reacting to the crypto-hostile climate in the country with ever more skilful evasive maneuvers. On the one hand, this includes the decentralization of one’s own business via peer-to-peer solutions. On the other hand, the investors defy the surveillance measures with VPNs, through which they can call blocked websites. In addition, there should be evasive movements to Hong Kong.
In view of the increased investment in yuan, China’s regulatory measures do not appear to be as comprehensive as planned. The government’s interest in Bitcoin and Blockchain can not be maintained without increased awareness of the potential of cryptocurrencies in the population – especially as the Chinese economy is growing and fostering differentiation in the financial market.