Throughout the last year, the cryptocurrency market took a series of heavy your punches from the Chinese government. The market took the hits as being a warrior, but the combos have taken its toll in many cryptocurrency investors. The market lackluster performance in 2018 pales in comparison with its stellar thousand-percent gains in 2017.
What includes happened?
Since 2013, the Chinese government have taken options to regulate cryptocurrency, but nothing compared to what was enforced inside 2017. (Check out this article for a detailed analysis of your official notice issued by the Chinese government)
2017 must have been a banner year for the cryptocurrency market with all the attention and also growth it has achieved. The extreme price volatility forced the particular Central bank to adopt more extreme measures, including the debar of initial coin offerings (ICOs) and clampdowns for domestic Crypto Articles exchanges. Soon after, mining factories in China based online stores were forced to close down, citing excessive electricity utilization. Many exchanges and factories have relocated overseas in avoiding regulations but remained accessible to Chinese investors. non-etheless, they still fail to escape the claws of the Chinese Dragon.
In the latest series of government-led efforts to monitor along with ban cryptocurrency trading among Chinese investors, China lengthened its “Eagle Eye” to monitor foreign cryptocurrency exchanges. Providers and bank accounts suspected of carrying out transactions with international crypto-exchanges and related activities are subjected to measures out of limiting withdrawal limits to freezing of accounts. Now there have even been ongoing rumors among the Chinese online community of more extreme measures to be enforced on unusual platforms that allow trading among Chinese investors.
“As for whether there will be further regulatory measures, we will should wait for orders from the higher authorities. ” Excerpts from your interview with team leader of the China’s Public Information Market Security Supervision agency under the Ministry of Public Security measure, 28th February
WHY WHY WHY!?
Imagine your child the fundamentals his or her savings to invest in a digital product (in this case, cryptocurrency) that he or she has no way of verifying its authenticity and cost. He or she could get lucky and strike it rich, or simply lose it all when the crypto-bubble burst. Now scale of which to millions of Chinese citizens and we are talking about regarding Chinese Yuan.
The market is full of scams and pointless ICOs. (I’m sure you have heard news of people sending loose change to random addresses with the promise of doubling their whole investments and ICOs that simply don’t make sense). Many unsavvy investors are in it for the money and could care less about the technology and innovation behind it. The significance of many cryptocurrencies is derived from market speculation. During the crypto-boom throughout 2017, participate in any ICO with either a famous expert onboard, a promising team or a decent hype and you are usually guaranteed at least 3X your investments.
A lack of understanding of typically the firm and the technology behind it, combined with the proliferation with ICOs, is a recipe for disaster. Members of the Critical bank reports that almost 90% of the ICOs are generally fraudulent or involves illegal fundraising. In my opinion, the China’s government wants to ensure that cryptocurrency remains ‘controllable’ and not too large to fail within the Chinese community. China is taking the perfect steps towards a safer, more regulated cryptocurrency earth, albeit aggressive and controversial. In fact , it might be the best step the country has taken in decades.