In the last year, the cryptocurrency market took a series of heavy punches from the Chinese government. The market took the hits like a warrior, but the combos have taken it is toll in many cryptocurrency investors. The industry lackluster performance in 2018 pales in comparison to its outstanding thousand-percent gains in 2017. Crypto News Today
What has happened?
Seeing that 2013, the Chinese govt have taken measures to regulate cryptocurrency, but nothing at all compared to what was enforced in 2017. (Check out their article for a detailed analysis of the official notice released by the Chinese government)
2017 was a flag year for the cryptocurrency market with all the attention and growth it has achieved. The extreme price volatility forced the Central bank to take up more extreme measures, including the ban of primary coin offerings (ICOs) and clampdowns on domestic cryptocurrency exchanges. Soon after, exploration factories in China were forced to close down, citing excessive electricity ingestion. Many exchanges and industries have relocated overseas to avoid regulations but continued to be accessible to Chinese buyers. Nonetheless, they still are unsuccessful to escape the paws of the Chinese Monster.
In the latest series of government-led efforts to monitor and ban cryptocurrency trading among Chinese shareholders, China extended its “Eagle Eye” to monitor international cryptocurrency exchanges. Companies and bank accounts suspected of undertaking transactions with international crypto-exchanges and related activities are subjected to steps from limiting withdrawal restrictions to freezing of medical data. There have even recently been ongoing rumors among the Chinese community of more extreme measures to be enforced on foreign systems that allow trading among Chinese investors.
“As for whether there will be further regulatory measures, we must wait for requests from the greater authorities. inch Excerpts from an interview with team leader of the China’s Accumulated Network Security Supervision agency under the Ministry of Community Security, 28th Feb .
Imagine your child investment his or her financial savings to invest in an electronic digital product (in this circumstance, cryptocurrency) that he or she has no way of verifying its genuineness and value. He or she could get blessed and strike it wealthy, or lose it all when the crypto-bubble rush. Now scale that to countless Chinese citizens and we are talking about billions of Chinese Yuan.
The market is packed with scams and pointless ICOs. (I’m sure you have heard news of men and women mailing coins to random details with the promise of doubling their investments and ICOs that simply may make sense). Many unsavvy investors are in it for the money and would care less about the technology and development behind it. The significance of many cryptocurrencies is derived from market speculation. During the crypto-boom in 2017, take part in any ICO with either a famous expert onboard, a promising team or a decent media hype and you are assured at least 3X your investments.
A lack of understanding of the company and the technology in back of it, combined with the proliferation of ICOs, is a recipe for tragedy. Members of the Central bank reports that almost 90% of the ICOs are fraudulent or requires illegitimate fundraising. In my opinion, the Chinese authorities wants to ensure that cryptocurrency remains ‘controllable’ rather than too big to are unsuccessful within the Chinese community. China is taking right steps towards a more secure, more regulated cryptocurrency world, albeit aggressive and dubious. In fact, it might be the best move the country has used in decades.