Why haven't we sufficiently decoupled from the Chinese market?

[njcarlos]

Looking for some insights on this question...

Until this occurs I find it hard to argue for any "signals" of a bear market reversal.

[blatchcorn]

New start-ups are being made for bitcoin everyday, it is gaining huge awareness and overcoming most regulatory hurdles.  Bitcoin is very undervalued.

[njcarlos]

New start-ups are being made for bitcoin everyday, it is gaining huge awareness and overcoming most regulatory hurdles.  Bitcoin is very undervalued.

That's my point. If people are considering current valuation "cheap" why aren't we decoupling from China's downward trend. They've been the market makers from the beginning up until now, and continue to be. But why? The fact that they remain in this position suggests, to me, that we have not seen the bottom of this bear market but I'd like to get some opinions on it.

[blatchcorn]

New start-ups are being made for bitcoin everyday, it is gaining huge awareness and overcoming most regulatory hurdles.  Bitcoin is very undervalued.

That's my point. If people are considering current valuation "cheap" why aren't we decoupling from China's downward trend. They've been the market makers from the beginning up until now, and continue to be. But why? The fact that they remain in this position suggests, to me, that we have not seen the bottom of this bear market but I'd like to get some opinions on it.

There are still too many Veronicas left in the market

[N12]

Because when the price on Huobi goes significantly below Bitstamp, you can withdraw your bitcoins from Houbi, send them to Bitstamp and sell there for a higher price. You can now send money to Huobi, repeat it again and make money.

So long as you can withdraw bitcoins from Chinese exchanges, arbitrage will be possible if the price is lower.

[Mythul]

It takes time I guess...

[wachtwoord]

Because when the price on Huobi goes significantly below Bitstamp, you can withdraw your bitcoins from Houbi, send them to Bitstamp and sell there for a higher price. You can now send money to Huobi, repeat it again and make money.

So long as you can withdraw bitcoins from Chinese exchanges, arbitrage will be possible if the price is lower.

Indeed arbitrage. I'm wondering how many arbitragers will lose a significant sum with money ending up tied up however in the Bitcoin economy in general (so not just Huobii)

[Gyrsur]

Because when the price on Huobi goes significantly below Bitstamp, you can withdraw your bitcoins from Houbi, send them to Bitstamp and sell there for a higher price. You can now send money to Huobi, repeat it again and make money.

So long as you can withdraw bitcoins from Chinese exchanges, arbitrage will be possible if the price is lower.

I'm able to follow this until the point I have to choose a bank account on Huobi to transfer money to it. or are there other possibilities to put fiat money on Huobi?

[dreamspark]

Arbers always keep the prices fairly in line. The real question is why haven't we rallied and dragged China with us 

[proudhon]

Because when the price on Huobi goes significantly below Bitstamp, you can withdraw your bitcoins from Houbi, send them to Bitstamp and sell there for a higher price. You can now send money to Huobi, repeat it again and make money.

So long as you can withdraw bitcoins from Chinese exchanges, arbitrage will be possible if the price is lower.

This.  As long as people can move money/bitcoins from Chinese markets to non-Chinese markets, "we" won't decouple from the Chinese markets.  I suspect we never will decouple.

[njcarlos]

Arbers always keep the prices fairly in line. The real question is why haven't we rallied and dragged China with us  

This...

Because when the price on Huobi goes significantly below Bitstamp, you can withdraw your bitcoins from Houbi, send them to Bitstamp and sell there for a higher price. You can now send money to Huobi, repeat it again and make money.

So long as you can withdraw bitcoins from Chinese exchanges, arbitrage will be possible if the price is lower.

This.  As long as people can move money/bitcoins from Chinese markets to non-Chinese markets, "we" won't decouple from the Chinese markets.  I suspect we never will decouple.

I can't follow this logic for some reason. If Huobi or BTCChina dumped, why would it drop in the US markets? If we decoupled wouldn't someone arb for that higher margin? For instance... if it was true that within the states we felt $450 was "cheap," arbitrage on a falling Chinese market would only become more lucrative with growing margins. It shouldn't depress our market. But, that fact that it does suggests to me that the order book is mostly stuffed (much like HFtraders will stuff orders) and there really is no bullish sentiment strong enough to maintain current valuations. Am I incorrect about this? I'm just not understanding why arbitrage would necessarily depress a market.

[voluntarist500]

just wait until they officially unban it again. lol

[r34tr783tr78]

I think I never saw western markets so linked to Huobi. Presently, if you want to trade on any of the three big western markets you have to follow Huobi, because any move on it is mimic by the other markets. It's not only because traders move their bitcoins looking for the best price, it's because after the end of Gox everyone looks for guidance from the biggest exchange: http://www.bitcoinity.org/markets/list?currency=ALL&span=24h
If the price on Huobi goes down because of the chinese government, guess what will happen.

[MatTheCat]

I'm able to follow this until the point I have to choose a bank account on Huobi to transfer money to it. or are there other possibilities to put fiat money on Huobi?

Arbing between USD and CNY exchanges is not for you. But there are those who have the funding lines in place to do so.

I think I never saw western markets so linked to Huobi.

Nearly all the BIG moves are instigated on Huobi.

[UglyTroll]

If the price on Huobi goes down because of the chinese government, guess what will happen.

Now the problem is not about whether or not price on Huobi goes down, it's about whether or not Huobi itself goes down in weeks  

[r34tr783tr78]

A quick death would make a tsunami on western markets, because of the negativism and because traders would expect a fast influx of sell orders of bitcoins from China on western markets.
But a slow death, with lower volumes, lower demand caused by the end or lower influx of CNY and a continuous drop of price, with chinese traders cleaning their portfolio of bitcoins, would be worst. It would be another Gox on our hands.

[TERA]

because they're still open and the forces of arbitrage from a massive shadow currency market are going to be stronger no matter what than your feelings about the fundamentals

[Pepin]

One thing that I can't wrap my head around is why most people here think that if tomorrow Bitcoin were completely shut off from the RMB, Bitcoin prices would miraculously rise. Do people actually think that the fiat prices for Bitcoin have nothing to do with supply and demand? The amount of Bitcoin on the market and being continuously mined will not decrease, but the amount of fiat being spent on purchasing Bitcoin will sure go down.

People here love speculating that it was solely an influx of Chinese money that brought Bitcoin to over 1000 USD late last year. But then all of these same people think that it isn't Chinese money helping to keep it up over 400 USD right now? With all the noise coming out of China (which in China has always been the same tune, unlike all these "bans" people complain about here), people have still been free to very easily convert their RMB into Bitcoin. When or if it actually becomes impossible to use normal banking in China to purchase Bitcoin with RMB, the extra time, hassle, and expense involved to purchase Bitcoin with RMB might depress prices.

[r34tr783tr78]

Bagholders/permabulls like to dream that everything is going to go alright, in the long term (they probably are right, but we can't be shore), in the median term and tomorrow. That everything that happens HAS to be good news for bitcoin. They are living their Bitcoin fairy tale. They are our Doctor Pangloss.

[dreamspark]

One thing that I can't wrap my head around is why most people here think that if tomorrow Bitcoin were completely shut off from the RMB, Bitcoin prices would miraculously rise. Do people actually think that the fiat prices for Bitcoin have nothing to do with supply and demand? The amount of Bitcoin on the market and being continuously mined will not decrease, but the amount of fiat being spent on purchasing Bitcoin will sure go down.

People here love speculating that it was solely an influx of Chinese money that brought Bitcoin to over 1000 USD late last year. But then all of these same people think that it isn't Chinese money helping to keep it up over 400 USD right now? With all the noise coming out of China (which in China has always been the same tune, unlike all these "bans" people complain about here), people have still been free to very easily convert their RMB into Bitcoin. When or if it actually becomes impossible to use normal banking in China to purchase Bitcoin with RMB, the extra time, hassle, and expense involved to purchase Bitcoin with RMB might depress prices.

Your forgetting that its the uncertainty coming from the Chinese exchanges thats keeping the price down, thats the factor that would no longer be the case if Bitcoin was shut off from RMB. People who want out for good are out and people who don't will stay either way. However there are many who are simply waiting on the sidelines until the situation is sorted, every time there is a peep out of China the price drops so why would I invest my money until the full situation is clarified.

There were a number of factors to last years bubble. I would speculate it was the gox effect more than China that took us there.