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China's situation and cryptocurrencies price

15 september 2017, 00:13

We will take a look at the charts to see how one regulation in China can influence the whole cryptomarket.

How bitcoin influence other coins

Once in a while there is a significant crash on the market. Sometimes it it caused naturally and is directly connected to the bubble that has to finally burst, but sometimes there is a significant news and real situation behind it.

You might have noticed that Bitcoin has dropped from $4300 to $2990 within few days.

China's situation and cryptocurrencies price

Even though it happened quite smoothly and even on the charts you can see that it wasn't the usual sudden spike, it is still a big thing for the whole cryptocurrency market in general. As all the other coins and tokens are directly connected with the bitcoin. When it is going up, the altcoin market is raising twice as fast, however when bitcoin is in some kind of crisis, other coins are dropping twice as bad.

Let's look at the Ethereum chart.

China's situation and cryptocurrencies price

You can also see some popular coins examples below. Notice how they all go down at the same time, it shows there there is no cryptocurrency where you can securely hide and wait until the issues are solved.

China's situation and cryptocurrencies price

China's situation and cryptocurrencies price

China's situation and cryptocurrencies price

Chinese problem

The main thing that has caused this is the fact that China has introduced some non-official rules for cryptocurrency exchanges that in the end forces few big exchanges to close. Some people consider China to get off the cryptocurrency ride with such decision. It's quite weird as Chinese investors are relatively big players on the market and influence the price everyday with their trades.

Below you can find the allegedly imposed rules translated from Chinese:

1. Before 20 September 6pm, exchanges shall come up with a detailed risk-free clearing plan, and send this plan to the office. Exchanges shall deal with their claims and liabilities properly, and insure that investors funds and virtual currencies are safe.
2. Before 20 September 6pm, exchanges shall determine a bank account, which will be used for depositing user funds. All other accounts in banks and other non-bank payment service providers shall be canceled and reported to the Business Management Department of Peoples Bank of China.
3. Before 15 September midnight, exchanges shall publish closing announcements, and announce a schedule to stop the trading of all virtual currencies. New user registration shall be stopped immediately after the announcement.
4. Shareholders, controllers, executives, and core financial and technical staff of exchanges shall cooperate fully with authorities during the clearing, while staying in Beijing.
5. Exchanges shall report their developments daily to local authorities before the clearing is completed.
6. Exchanges shall save all user trading and holding data, and send it to local authorities immediately in DVDs.
The document is signed: The office of the Leading Group of Beijing Internet Financial Risks Remediation, Sept. 15, 2017

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