Bitcoin Forum

As some of you may not know, btcchina.com is now trading at 193.85CNY, or 31.1USD, while MtGox is trading at 29.7USD. It is 4.7% higher, and this phenomenon has lasted for at least 2 weeks. In December and January, it was always trading lower than MtGox.

Please also look at the weekly volume chart of btcchina:

http://bitcoincharts.com/charts/chart.png?width=940&m=btcnCNY&SubmitButton=Draw&r=&i=Weekly&c=1&s=2010-01-01&e=2013-02-26&Prev=&Next=&t=S&b=&a1=&m1=10&a2=&m2=25&x=1&i1=Vol&i2=&i3=&i4=&v=0&cv=1&ps=0&l=0&p=0&

Five weeks ago, weekly trading volume in CNY suddenly doubled from 0.63M to 1.32M, making an all-time-high. More importantly, it stays at this level since then. Last week it doubled again, from 1.59M to 3.14M.

Bitcoin has big potential in China:

• 1. Hedging for serious inflation. The official figure is about 5%pa, and no one would believe that;
• 2. Money laundering for corrupt officials: China is one of the most corrupt country in the world;
• 3. Circumventing taxation: China ranks the second on Forbes Tax Misery Index
• 4. Circumventing foreign exchange control: It's difficult to move money in/out the country and obtain foreign currency. That may also explain why people pay more CNY to buy bitcoin because it's difficult to send money to Gox;
• 5. Gambling: Chinese are very obsessive in gambling. In 2011, Macau collected US$33.5 billion from gamblers, comparing with only US$4.5 billion in Vegas;
• 6. Big internet population, still with huge room of growth: There are 538M internet users in China, accounting for only 40% of the total population. In US, there are only 245M, and that's 79% of the total population (i.e. nearly saturated)
• 7. Bitcoin has very low popularity in China: The volume in btcchina is only 4% of Gox. It sounds bad, but that also means the growth could be more dramatic.

If Chinese big players try to get on the train, the momentum could be really tremendous. Don't bet on the wrong size.

Newsflash! New exchanges increase in volume.

cool story bro tell it again.

It's not new. It has been running since July 2011

lol

bulls grasping at straws,  ;D cool

the present rally is reflecting an increasing demand all over, not just china. the chinese market is but a part and could just as easily drive a sell-off if the 'big player' starts to see prices drop on other exchanges.

in other words, increasing demand is obvious. why else should the price increase 600% in 12 months? this says nothing about whether or not we're at the market equilibrium or are overbought or oversold. this may even be a bubble symptom -- is this 'smart money' or panic buying? how does the saying go? when your mom starts trading with leverage, it's time to get out.

sorry for the bearish sentiment, just trying to provide another perspective.

You can't wake up someone who pretends to be asleep, even when it's an earthquake. ;)

From what I've read... I think macao is a huge potential for bitcoin. Why? Because they have issues with getting money back and forth across the chinese border. I read that they basically have to get paid once they are back in china since they can't bring money across the border or something.

Very well-informed article, and I could supplement it with the following picture, the Google trend for the Chinese phrase of "bitcoin":

https://i.imgur.com/ALojTbCl.jpg

Add to the list that the so far only two groups to successfully deploy mining ASICs are both based in China.

For Chinese citizens going to Macau to gamble, bringing enough money with them presents a problem.

http://emergingmoney.com/china/macau-casino-pawn-shop-lvs-mpel/

"Because of capital controls imposed by the Chinese government, Mainland citizens coming to the Macao Special Administrative Region are only allowed to bring in 20,000 RMB, or a little over $3,000. "

"Pawn shops in Macau allow Chinese residents to use debit cards to purchase high-end merchandise such as rolexes, then immediately re-sell the good back to the pawn shop for cash. The pawn shop takes a nominal fee and the gambler has managed to acquire the cash necessary for gambling."

They are probably responsible for the exchange volume during the current bubble.

You need to look at Baidu trend since google is blocked by the Chinese government.

http://index.baidu.com/main/word.php?word=%B1%C8%CC%D8%B1%D2

The Baidu trend is still at about 60% of the 2011 bubble. However, it has increased by 4-time since 2013, with the peak during Avalon shipping.

If the selling pressure in China is high, the rate at btcchina should be lower than gox. However, it's 4% over gox, which means buying pressure is even higher.

They received USD which probably got converted in yuan when pitpay issued them a IBAN transfer so yeah..
If they want to get BTC they'd have to buy in yuan.

While looking at this I learned that red means "up" in China. Interesting.

That's true.

If anything Hongkong should be the next largest exchange.

Bringing money from and to mainland is never a problem in HK. And HK has the best banking network with the Western. If BTC needs to grow in China, HK is the hub for it.

On a related note, the BTC trades usually for 1-2 EUR higher on bitcoin.de.

I bet you're having a good time with all that renewed hope and your bet looking good. Enjoy!

Yep. Do you recall when it changed? It was trading only marginally higher last year.

Is the rally driven by non-US people mainly?

What's interesting is btcchina had always traded at lower than Mt.Gox price, until recently.

The spread between different currencies and mtgox usd is usually related to volatility.

basically non-mtgox-usd < mtgox-usd < mtgox-other < non-mtgox-other. This has been pretty much consistent mostly and if you take into account how arbitrage works it makes sense.

take into account the rising yuan.

Btcchina displays the rate in both currencies.

Care for a link? I'd like to check that myself. I only see the yuan prices on their site.

Someone wrote here last year that Btcchina did not have a live ticker and order book. They only update price in 5 minutes interval. Also the tradition in China for small investors is to speculate in bucket shops with very little to go on besides the price on the stock they are trading.

So are Chinese traders more of a gambling mentality? Do Btcchina really smell legit, have they improved?

(I'm not Chinese, despite my signature)

It's the front page of the site, right above the chart there are two tables, the right table displays Mt.Gox prices in both currencies, last/max/min prices, etc, the USD is converted into CNY in real time, and the rate is up to date, if you compare the equivalent CNY price to the left column btcchina price, which is displayed in CNY only, the btcchina price is consistently higher, though not by that much ATM

There has always been an orderbook as far as I am concerned. And according to the site frontpage, the local last price refreshes in real time, it's the referential Mt.Gox price that refreshes in 5 minutes interval.

We were talking about the past prices though. That's was I meant the yuan prices appear to have been lower in the past because the exchange rate yuan/usd is now higher.

It mean that a small splinter of Chinese young people have finally waked up and wanted to hurry up in order to participate in the game. As far as I know, even among the tech-savvying white collars in Shanghai, only smaller than 1% of them have ever heard of it or have some basic understanding of the crypto-currency.  So my conclusion is: the potential is way too biiiiiiiiiiiiiiiiiiig!

At Jan 27th(I pick that day because price was relatively stable during the day), the yuan/usd rate was even higher at 1usd=6.22 yuan, the btcchina price, according to the chart on the frontpage(the "transaction price" could be seen by hovering the pointer over the data point), was ￥107.99/6.22=17.3633 usd, if btcchina uses Beijing time, the Mt.Gox price for the corresponding time-frame (it uses UTC) would be between 17.4-17.7 usd, if both use UTC time, Gox closing price would be 17.81, assuming, of course, that by "transaction price" btcchina means "closing price". Of course it is just one data point but this is generally in agreement with my own recollection.

EDIT: oh I forgot bitcoinchart's datas of btcnCNY, http://bitcoincharts.com/charts/btcnCNY#rg60ztgSzm1g10zm2g25zv it was actually the closing price they display on the frontpage chart.

That sounds way too complicated dude.

Actually who is there to stop all kinds of unwanted people from parking a significant portion of their assets in bitcoins? If I were one, I would be glad to sell USD.

Kind of waiting for the strategic acquisition race, when it finally starts in its earnest :D

I am very sure because in December and January's I kept buying in btcchina and selling in gox immediately

They already are. Some people here would make the Great Leader of the Korean People look like a muppet in comparison if placed in this position.

Since the rally started, gox usd and virtex cad are often off compared to the bank exchange, with canadian coins being more expensive. This was not the case so often before.

Perhaps the rally is universal, but americans tend to sell off more ;)

How come there are peaks for your search term in 2007 and 2008???
It it was "Bitcoin" there couldnt possibly be so large spikes. Care to explain?

No, the default chart is only for the last month. For example, the peak "D" is the Avalon news on 4 Feb (2月4日). The year scale below is another graph for you to zoom in/out.

The Chinese have an interest in displacing the dollar as the currency of choice for oil transactions. They're unlikely to be able to do that with their own currency. The Euro doesn't really help them and has its own issues in any case. Could they be looking at Bitcoin for the job?

What's funny is that you calling this grasping at straws is really just you grasping at thin air.  Funny or sad. Can't decide.

It just occurred to me that mining economics in China would be much more favorable: you can buy ASICs and other hardware domestically (cheaper, I assume), and you have a very low cost of living so a few BTC in profit per month is a big deal. Mining in China might take off. What is the search term for mining bitcoins? 比特市発掘？

It is already happening since 2011 AFAIK.

The other day there was a Chinese mentioning that he got together with some classmates to buy an Avalon rig.
They are forming mining guilds!

Bitcoin outsourced

one problem of mining in china is that is hard to get the equipment free of dust. and the lungs too. damn :(

They could set the rigs out in Africa and have local children keeping them running?

Sorry it may be obvious or already mentioned, given that we're talking about China

How is bitcoin going to work through the great firewall of China?

Bitcoin is probably as resilient as Tor, you will have to shutdown a large portion of the internet to decapitate the network. Besides, why?

No problem at all this moment. People can use, trade, and discuss publicly.

WRONG!!!!!
There is a LEGAL limit of 10-20kRMB of RMB that can be hand carried across the border. Anything outside of that range CAN BE CONFISCATED.
to do an IBT (inter-bank trnsfer, requires a special licence)

The MAXIMUM you can change at a bank in Hong Kong is 20K a day WITH IDENTIFICATION.
Up until last year it was only allowed for Hong kong residents.
 http://www.info.gov.hk/gia/general/201207/25/P201207250563.htm (http://www.info.gov.hk/gia/general/201207/25/P201207250563.htm)

You obviously don't know WTF you are talking about......

Idiot, you obviously dont know how brokers/agents works.

Have you ever wondered how all those ebay sellers make more cash?

I never said its legal, i said its never a problem. I guess i cant expect kids like you to understand.

Hint for you: most if not all agents are located in Shenzhen.

Today, BTC China shot up to 296CNY, or 47.57USD. Somebody spent >100k USD to archive this ATH

Don't underestimate Chinese speculators. Some of them could be really irrational

http://bitcoincharts.com/charts/chart.png?width=940&m=btcnCNY&SubmitButton=Draw&r=1&i=15-min&c=1&s=2013-03-06&e=2013-03-06&Prev=&Next=&t=S&b=&a1=&m1=10&a2=&m2=25&x=1&i1=Vol&i2=&i3=&i4=&v=0&cv=1&ps=0&l=0&p=0&

I recently came across some Wenzhou businessman invested in bitcoin, hmmm..........  ::) ;D

Are you serious? That's really huge!

Well I wouldn't say it's huge yet, but I also have enough confidence in their business sense, once some of them get to know it, they could eventually figure out its potential. And as we all know, the price of pretty much anything they go after will............ ;D

Bitcoin could be big for the Chinese. Consider all the doo-hickeys you can buy on ebay for a dollar with free shipping. For that dollar, you're getting shipping, ebay fees, paypal fees, currency conversion fees and finally, the doo-hickey itself. Bitcoin could eliminate at least two and weaken a third of those.

Consider also that the Chinese economy has some underlying issues itself and that it appears to be experiencing some serious bubbles. A reliable store of wealth could be just what smart people are looking for. I bet gold is hard to own there too.

http://sovereignlife.com/blog/2010/chinese-government-encourages-gold-buying/ (http://sovereignlife.com/blog/2010/chinese-government-encourages-gold-buying/)

Interesting. Though that could also be said to operate in Bticoin's favor too :D

I'm not sure I understand his hypothesis. My take on China encouraging people to invest in gold is for them to one day confiscate all the gold to back the state currency.

China has a huge gold market, it has been for a long time. Besides, I bet that CPC is invested in BTC itself, you guys have no idea how many of the high-level cadres believe in the "currency war" theory, and they seem to be particularly into the idea of IMF Special Drawing Rights as a global standard currency, probably they are open to other new ideas, and yes, they have got first-class finanical mathematicans/ analysts working for them.

oakpacific, thanks for the input.  I'm not in disagreement, but how much of this is just hearsay?    Will China back their currency with gold in the next few years?  What's you're source, on everything?

Well, I didn't say China will back their currency with gold, just that buying gold has never been a problem here. The BTC part is of course pure speculation, other than the fact that the demand for BTC is obvious, as has been pointed out by the OP, the "currency war" part could be verified by many media reports out there(I can look them up if you want), the IMF SDR part is really old news, they openly proposed it, the report was everywhere.

It nearly hit 300 yuan (significant psychological resistance for chinese here) and then bounced back (that was the reason for the slight dip a few hours ago). That's 48.2 in USD (while mtgox USD only hit 46). I think what is driving mtgox right now is primarily chinese arbitragers...

Check out the charts:

USD, no significant resistances:

https://i.imgur.com/NzhPBtd.png


Yuan:

https://i.imgur.com/VFh6BNK.png

If my hypothesis is correct, we have not seen anything yet. Buckle your seatbelts.

You obviously don't know what the fuck you are talking about. My family runs a jewelry firm in Hongkong and we bank gold and silver for around $225k per day. But we are known in banks like BoC and HSBC so we don't need identification anyway. I have seen and I've heard and i KNOW 100s of times where people has put in 30-40- even 70k with just their passport (they're expats) mostly because they do it with money from our jewelry store. If you could only deposit $3k they would be toast. They go to really any bank, open an account with their passport and they're free to deposit their money, no questions asked. HK-banks are the new swiss banks. And even if it weren't, you could easily have a few dinners and lunches and a little money on the side and there would be no questions anyway. You should know this if you live here, because it's common practice. Everyone and everything can be bought here. Just look at any of the Shenzhen border controls and all the human mules passing by 30 times per day.

 The hongkong bank system is the role model for most offshore banking systems and we're not even considered offshore.

occam rang and told me he is quitting the razorblade business cos of this post :D

I dont know jack about HK either but your explanation sounds pretty much *exactly* how I reckon it is going down, much like it always has everywhere else in the world, since forever.

Money Talks...