The China Effect

[BitHodler]

Fiatleak to me seems to be correctly registering every single buy trade (at a first glance). But it's obvious that zero-fee exchanges incentive their users to trade _much_ more than if there were fees - it has not even to be intentional fake trading or manipulation, and so almost every bitcoin "leaked" from the fiat system goes to China (but >90% of them get converted instantly to fiat again ).

In a couple of hours we will see if this proportion will still continue after the end of the zero fee policy. As volume has already dropped at these exchanges I expect the volume decrease between January 23 and 24 will not be extremely high, but we can expect at least another 50% - if not 70 or 80 % - decrease.

The impact on price is unclear for me. It is possible that less overall trade volume is viewed as a bearish indicator by some traders, but in my opinion most will know the reason and so the bearish impact will be limited. The scalability/block size/segwit debate, in my opinion, is much more important.

The difference in trading volumes over at Chinese exchanges has already shown up where I also expect that their volumes will tank even deeper.

I am still waiting for the mainstream media to jump in on this where they report about the massively dropped volumes. I wonder how long it will take.

Recently they reported about the higher than ever trading volumes where it's entirely a China ruled market. They didn't even pay attention to the fact that the vast majority of their volumes are fake.

It just shows how ignorant the media is. I won't even be surprised when they will give a negative twist to the dropped volumes in China. Something in the way of "Bitcoin lost popularity" bla bla bla.

[bit1]

   Chinese exchanges have accounted for 42 percent of all Bitcoin transactions in 2016 year. I search more about this topic on internet, China is growing and their economy is growing every year. China, up until about 50 years ago, was a small-time player on a global scale now they are strong force.
   I found this real time the influence of China on current bitcoin trading: http://fiatleak.com/
   First minute all bitcoins are going just to Chinese, then US a bit and couple times in Russia. Looks like Chinese are dominating!

Well do not forget that it is also the most populated country in the world, maybe that's another reason why they have more predominance in some things, as in this case for example, but as they sell their stock to make a profit, or to cover mining expenses, so finally someone else buys their stock, or they end up buying more expensive themselves, of course that for a long time more would remain in the lead in this area how has it been, but no doubt other countries would end up approaching this just in case it was necessary, not to forget that there are much more valuable stocks which could be auctioned to exchange for another to give security to their investment.

[AjithBtc]

As Op quoted China has been connected to bitcoin due to its increased user profiles. This could make fluctuations in the bitcoin price, to overcome this the users around the world needs to increase much more than the Chinese bitcoin users.

[Riddikulo]

Until now the exchanges have charged a fee only when moving money out of the exchange. This fee got smaller the more you had bought or sold bitcoins. So it was profitable just to move bitcoins from one account to another.
Chinese central bank is doing fine work atm also by forbidding margin trading, this will stabilize the market.

[ethereumhunter]

As Op quoted China has been connected to bitcoin due to its increased user profiles. This could make fluctuations in the bitcoin price, to overcome this the users around the world needs to increase much more than the Chinese bitcoin users.

it is difficult to increase more than chinese bitcoin users because they have a good hardware and they only use in their country and if depend with another user from another country, the different is too big and we can not follow behind the chinese bitcoin users. we need more money to make investment in bitcoin like what chinese bitcoin users do so we can behind or equal with them.

[error08]

What is happening right now with the value of Bitcoin can all be partly traced to China. Chinese hold a big portion of the quantity of Bitcoin now circulating globally...they can manipulate its value and whatever they do that can affect Bitcoin will have a direct and indirect impact on its market value. Not to mention the fact that pronouncements from the China government in relation to Bitcoin can send the value of Bitcoin tumbling down or rolling up.

And this leads me into thinking...is Bitcoin now tied to China and is there something we can do about it?

It is true that Chinese country have to do to much with bitcoin nowadays. The last pump was dedicated to them. The same can be told even the actual dump. What can we do about this? Only one thing: spread the word about bitcoin everywhere. In this way bitcoin will not depend more only from Chinese market and for more from the statements of the Chinese Government which are even the reason of this actual dump.

We don't know exactly who have manipulated the market price. Yes, China miners and users hold big portion as the biggest trading volume happens in there. Big whales that always manipulate the market obviously, but we can't say that come from China if there's no any legit evidence as the bitcoin transaction consider as anonymous. If they sold out their bitcoins, and the price go down, then it's the right time to buy instead of panic sell too.

[thejaytiesto]

China is just playing his cards... it's all about timing. They are dropping all those small bombs, trying to constantly dip the price and profit from it. It's obvious there are some people out there with insider information getting rich with all those dips that happen whenever the PCOS has to say anything, notice that it doesn't matter what they are saying, but when. The result is always the same: a dip.

But that has a short lived effect, eventually they will run out of steam, once all the cards are used, they will have nothing left, all those programmed dips will not happen again and Bitcoin will rise higher than Huge Black Woman's diabetes.

I agree, and looks like they are running out of cards on their deck, and once that happens, the party is on. We will basically have a bunch of idiots that panic sold their cheap bitcoins to the chinese government. I have no doubt in my mind that the chinese government is creating secretly a stack of bitcoin to store long term and become the #1 world ranked country of bitcoin reserve. Bitcoin is the new gold and china will dominate if the rest of the countries dont wake the fuck up and start buying.

[ICOGuru]

China is just playing his cards... it's all about timing. They are dropping all those small bombs, trying to constantly dip the price and profit from it. It's obvious there are some people out there with insider information getting rich with all those dips that happen whenever the PCOS has to say anything, notice that it doesn't matter what they are saying, but when. The result is always the same: a dip.

But that has a short lived effect, eventually they will run out of steam, once all the cards are used, they will have nothing left, all those programmed dips will not happen again and Bitcoin will rise higher than Huge Black Woman's diabetes.

I agree, and looks like they are running out of cards on their deck, and once that happens, the party is on. We will basically have a bunch of idiots that panic sold their cheap bitcoins to the chinese government. I have no doubt in my mind that the chinese government is creating secretly a stack of bitcoin to store long term and become the #1 world ranked country of bitcoin reserve. Bitcoin is the new gold and china will dominate if the rest of the countries dont wake the fuck up and start buying.

Very well put.
I cant agree more, they have been buying Gold and Bitcoin. They will at one point hold most of the actual worth of the world if they keep it up.

[BitFinnese]

China is just playing his cards... it's all about timing. They are dropping all those small bombs, trying to constantly dip the price and profit from it. It's obvious there are some people out there with insider information getting rich with all those dips that happen whenever the PCOS has to say anything, notice that it doesn't matter what they are saying, but when. The result is always the same: a dip.

But that has a short lived effect, eventually they will run out of steam, once all the cards are used, they will have nothing left, all those programmed dips will not happen again and Bitcoin will rise higher than Huge Black Woman's diabetes.

I agree, and looks like they are running out of cards on their deck, and once that happens, the party is on. We will basically have a bunch of idiots that panic sold their cheap bitcoins to the chinese government. I have no doubt in my mind that the chinese government is creating secretly a stack of bitcoin to store long term and become the #1 world ranked country of bitcoin reserve. Bitcoin is the new gold and china will dominate if the rest of the countries dont wake the fuck up and start buying.

On the contrary isn't the being active of PBOC in implementing AML/KYC to their exchange is a preparation for the approval of ETF?   It is possible that PBOC have knowledge about the result of the decision of SEC regarding ETF and they want their exchange to be ready when it is approved?

[mamaita]

What is happening right now with the value of Bitcoin can all be partly traced to China. Chinese hold a big portion of the quantity of Bitcoin now circulating globally...they can manipulate its value and whatever they do that can affect Bitcoin will have a direct and indirect impact on its market value. Not to mention the fact that pronouncements from the China government in relation to Bitcoin can send the value of Bitcoin tumbling down or rolling up.

And this leads me into thinking...is Bitcoin now tied to China and is there something we can do about it?

you may have a point because after the Lunar New Year just bitcoin prices continue to go up a few weeks later to direct price down to $ 100
was once the effect

[JL421]

As Op quoted China has been connected to bitcoin due to its increased user profiles. This could make fluctuations in the bitcoin price, to overcome this the users around the world needs to increase much more than the Chinese bitcoin users.

I agree that china controls the price indirectly because most users from china but I also don't think it is actually possible for now that we can overcome this as till date bitcoin is most famous in countries like china and japan unless a business in your area starts accepting bitcoin as one of the payment method and slowly everyone in world does this we will be free from Chinese interference. But for now all we can do is go with the flow.

[OrangeII]

As Op quoted China has been connected to bitcoin due to its increased user profiles. This could make fluctuations in the bitcoin price, to overcome this the users around the world needs to increase much more than the Chinese bitcoin users.

I agree that china controls the price indirectly because most users from china but I also don't think it is actually possible for now that we can overcome this as till date bitcoin is most famous in countries like china and japan unless a business in your area starts accepting bitcoin as one of the payment method and slowly everyone in world does this we will be free from Chinese interference. But for now all we can do is go with the flow.

Well, I guess the thing we can do is just go with the flow. You must have a lot of resources to be able to change the current bitcoin. I agree if you said that china can provide a noticeable effect on bitcoin, it may be because one of the biggest bitcoin is china.

[Harry Callahan]

As Op quoted China has been connected to bitcoin due to its increased user profiles. This could make fluctuations in the bitcoin price, to overcome this the users around the world needs to increase much more than the Chinese bitcoin users.

How do you suggest doing so,do you force people to use bitcoin  it is a choice one have to take whether you are interested in investing in bitcoin or not.The Chinese has invested a lot and that shows by the volume of their trades in exchanges and so any negative news coming out of china will influence the price of bitcoin.

[Diced90]

There is no disputing the fact that the Chinese hold a big portion of the quantity of Bitcoins but as long as the central banks keep making btc trading or investing in china difficult investors will look for new territories/countries were they will go on with their business and the china effect will wear off after time.

[ASHLIUSZ]

There is no disputing the fact that the Chinese hold a big portion of the quantity of Bitcoins but as long as the central banks keep making btc trading or investing in china difficult investors will look for new territories/countries were they will go on with their business and the china effect will wear off after time.

Yes Chinese people hold a big portion of bitcoin assets, as quoted now the China effect have started to wear off. One of the reason is the recent days regulations in bitcoin use within the country. As a part several exchange services too was forced to shut down without any notification. But this has not made much impact on the price. This shows how China effect is going off.

[Doms]

There is no disputing the fact that the Chinese hold a big portion of the quantity of Bitcoins but as long as the central banks keep making btc trading or investing in china difficult investors will look for new territories/countries were they will go on with their business and the china effect will wear off after time.

Yes Chinese people hold a big portion of bitcoin assets, as quoted now the China effect have started to wear off. One of the reason is the recent days regulations in bitcoin use within the country. As a part several exchange services too was forced to shut down without any notification. But this has not made much impact on the price. This shows how China effect is going off.

There's always a knee-jerk reaction that triggers a noticeable decrease in price each time China decides to do something with bitcoin. There's also an inverse relationship pattern that is being formed with the yuan and bitcoin and it seems that only one of the two is going to be the safe haven for their money.

[HanSchultz]

There is no disputing the fact that the Chinese hold a big portion of the quantity of Bitcoins but as long as the central banks keep making btc trading or investing in china difficult investors will look for new territories/countries were they will go on with their business and the china effect will wear off after time.

The Chinese invest their money in bitcoin as they do not believe in regular banks and stock market and their currencies values is depreciated most of the time and so they find investing in bitcoin as a lucrative one as they are getting a good return from it and no one can complain about that and since the government is coming up with regulations it is time to see what they will be doing now ,whether they will dump bitcoin and catch another coin without regulation .

[richardsNY]

There is no disputing the fact that the Chinese hold a big portion of the quantity of Bitcoins but as long as the central banks keep making btc trading or investing in china difficult investors will look for new territories/countries were they will go on with their business and the china effect will wear off after time.

The Chinese invest their money in bitcoin as they do not believe in regular banks and stock market and their currencies values is depreciated most of the time and so they find investing in bitcoin as a lucrative one as they are getting a good return from it and no one can complain about that and since the government is coming up with regulations it is time to see what they will be doing now ,whether they will dump bitcoin and catch another coin without regulation .

These regulations have pushed Chinese people to LocalBitcoins in order to avoid buying at exchanges where they are subject to all kinds of regulations. I think that's quite a good development since Chinese people are known for their gambling like investment style. Instead of them dumping their coins on exchanges like crazy when they are at panic, they have to do more effort to sell their coins right now. Less noobish selling pressure on the price is what I consider to be a big plus.

[hollandvan]

China now has less power on the price of bitcoin, bitcoin is worldwide currency, and it is decentralized, why do you fear Chinese PBOC? Don't worry.

[QuestionAuthority]

China now has less power on the price of bitcoin, bitcoin is worldwide currency, and it is decentralized, why do you fear Chinese PBOC? Don't worry.

I think the PBOC gave the exchanges permission to fake the price so they can eventually screw over the round eyes.