If you’ve been wondering why bitcoin prices have climbed over the past months weeks…months, look no farther, it’s the Chinese — again. Okay. maybe India and a little Venezuela.
According to HolyTransaction, a premier cryptocurrency multi-wallet service, the Chinese connection exists. In fact, the service warned us in the past to watch out for bitcoin ‘shorts.’
I thought it might be a good idea to remind ourselves to watch — again.
China, in fact, has $30 trillion in deposits – which concerns about devaluations will make very “flighty” while the market cap of bitcoin is under $8 billion.
— HolyTransaction / May 31, 2016
Are the Chinese attempting to rescue their wallets, due to capital controls imposed by their government? That is the suggestion here — that it is a great way to move money out of the country.
The “Great Firewall of China” is essentially useless if a Chinese citizen knows how to avoid it with the many options Bitcoin has to ‘send’ and ‘receive.’
Another theory is the old ‘supply and demand’ scenario. There are fewer Bitcoins mined in now, because of a programmed mining halving and this supply reduction might continue to trigger higher prices, if demand remains constant.
Or is it the Ethereum issue? The fact that this relative newcomer to the crypto scene, courted by banks and investors, has stirred interest in Bitcoin? Maybe.
But as HolyTransaction indicated, China is probably the culprit.
How else can one explain it? If the Chinese account for more that 90% of the world’s Bitcoin trade they can certainly influence global prices.
…a Chinese investor effect, but also raise the possibility that the effect won’t last.
— Jeff John Roberts / Fortune / May 31,2016
And now the warnings sink in. When will the Chinese pull the plug?
The price of bitcoin in China has been roughly $50 or higher than in other countries. So why is China buying so much cryptocurrency, and why now?
–Jamie Redmond /news.bitcoin.com/May 31, 2016
Pulling the plug might not be in the cards any time soon. But remember the warning. The Chinese like to gamble.
As the Chinese government continues to devalue the Yuan, investors are signing up at the exchanges to beat the devaluations. Will Beijing move to further restrict bitcoin trade?
Will the government step in to halt the bitcoin trade in that country entirely?
If so, watch for bitcoin a tail spin.
Now think about where the Chinese will next invest? Will it be in Monero? For its privacy?
Think about that for a moment. The Chinese have the mining power. Would it be all that difficult to move in? Run Monero like they run bitcoin? Is Monero really that resistant to ASIC Mining? Bot driven miners?
A recent Come to Jesus incident happened with Monero recently. One Mining Pool — dwarfpol.com — actually surged past 51%. At that point, Monero could have been theoretically rewritten or simply owned by one party. We have been assured by the anonymous developers and one who remains public, that all is well.
Featured Image by Daderot (Own work) [Public domain], via Wikimedia Commons