What China Ban? Cryptocurrency Market Cap Rebounding

They're ba-aa-ack. Whether it's the Chinese, or the Koreans, or the Russians or us Americans is anybody's guess at this moment, but what it looks like for a few cryptocurrency players out there is that the Chinese have found a new way to get back into the game. China banned initial coin offerings and bitcoin exchanges in the first week of September. The ban caused a precipitous drop in cryptocurrency flows worldwide. As of Sept. 24 at least, the market is making a comeback.

"We could say that it looks like the 'Chinese effect' that provided downward pressure in the cryptocurrency market is over, but we cannot prove it quite yet," says Dima Zaitsev, business analytics chief for ICOBox in Milan. Zaitsev and Dmitri Kornilov, director of economics at the Russian Academy of Natural Sciences, devised the chart for ICOBox, a cryptocurrency fund raising platform and service provider. "If this continues, then I would say with almost certainty that the downward pressure is over."

 

Nearly a billion dollars have reportedly returned to Chinese investors that put money to work in some 40-plus ICOs that took place on the mainland this year. An ICO is a crypto-currency funding mechanism for start-ups. Some say that the money was not really returned, but was redirected to Hong Kong and Singapore, where stronger investor protections exist.

 

China's central bank banned ICOs on Sept. 4 and later banned all bitcoin exchanges from operating in the country.

 

China's ban is likely temporary. The U.S. and Japan are quickly moving to create rules that will help to legitimize cryptocurrencies by giving investors protections under existing securities laws. That will help companies raise capital through alternative methods, rather than via venture capital and the equity markets, potentially opening up a whole new financial market.

 

Most crypto-currencies have recovered since China took a hammer to the two biggest names: bitcoin and ether. Bitcoin prices are over $4,000 again.

 

China outlawed ICOs and, shortly afterwards, bitcoin exchanges on the mainland. Regulators demanded that companies return their capital to investors.

 

Xinhua news reported on Sept. 22 that 90% of the money had been returned. Between January and August, over $1.1 billion had been raised in more than 65 ICOs, according to government figures.

 

 

Bron: https://www.forbes.com

Reactie plaatsen

Reacties

Er zijn geen reacties geplaatst.