Crypto-asset executives in China consider expansion beyond their zone, like Hongkong and Singapore, to bypass the crackdown that has escalated at home.
Currently, the value of bitcoin has been on the surge to over $18000. The price has doubled, displaying almost $10,000 in growth in the past two months. The rise in value in a miniboom of 2017, the rise has subsequently led to massive gains in cryptocurrency-focused hedge funds.
The value of bitcoin price has risen by about 15% over a week alone, making headlines in the world of finance. The massive acceptance of cryptos over traditional financial providers has contributed significantly to the sore in prices. Despite this, Beijing has been reinforcing already harsh measures over cryptocurrencies while the People’s Bank of China warms up to launch its digital currency.
Chinese Government Restrictions to Suppress Crypto Business
In 2017 China had a couple of regulatory standards to suppress crypto-related activities. Likewise, the government does not acknowledge cryptocurrency as lawful tender; it says the purpose of putting those measures is for financial risk prevention and investor protection.
The standards put in place include; limiting the primary business of cryptocurrency platforms, defining the initial coin’s aims as illegal, and discouraging bitcoin mining. Moreover, the ban stopped the swift growth of the crypto industry in the country. Europe’s largest digital asset manager, Coinshare, reported that China’s portion of global bitcoin trading had declined to less than 4% from around 17% in 2017.
Babel Finance. Hongkong based crypto platform requested an asset management license in town. The license in the Asian financial hub will enable the crypto-financial provider to get more crypto investors. Flex Yang, Babel Finance founder, aims to get $1billion dominating similar crypto financial service providers after receiving the license.
Gordon Chen, Co-founder of cryptocurrency asset, chose Singapore last year due to its regulatory structure. There was a high demand for the crypto market, and they stepped in to bridge the gap. At the moment, Chen is running over $20 million in bitcoin assets.
Onchain Custodian in Singapore intends to expand in China by first giving consultancy services in blockchain technology. Furthermore, the company takes account of Chinese conglomerate Fosun as an investor. Even so, most undertakings are still under restriction.
China is Off Track
Recently, the PBOC outlawed private issuance of digital currencies, and OKEx, a Malta-based crypto exchange, was demanded to defer their crypto withdrawals for a while since an executive was helping Chinese authorities with their investigation.
Gordon Chen feels sad that China is off the right track of international pricing power and the lead hub for bitcoin trading and mining. He added that China’s premium advantage had faded away.