Cryptocurrency's Rocky Road: China's ICO Ban

In the wake of China's ICO ban, what befalls the world of cryptocurrencies?

The largest event in the cryptocurrency world recently was the declaration of the Chinese authorities to shut down the changes on which cryptocurrency are traded. As a result, BTCCChina, one of the largest bitcoin exchanges in China, said that it would be ceasing trading activities by the end of September. This news catalysed a sharp sell-off that left bitcoin (and other departments such as Etherium) plummeting approximately 30% below the record highs that were reached earlier this month.

So, the cryptocurrency rollercoaster continues. With bitcoin having increases that surpass quadrupled values ​​from December 2016 to September 2017, some analysts predict that it can cryptocurrencies can recover from the recent falls. Josh Mahoney, a market analyst at IG comments that cryptocurrencies '' past experience tells us that [they] will likely brush these latest challenges aside. ''

However, these sentiments do not come without opposition. Mr Dimon, CEO of JPMorgan Chase, remarked that bitcoin "is not going to work" and that it "is a fraud ... worse than tulip bulbs (in reference to the Dutch 'tulip mania' of the 17th century, recognized as the world's first speculative bubble) ... that will blow up ". He goes to the extent of saying that he would fire employees who were stupid enough to trade in bitcoin.

Speculation aside, what is actually going on? Since China's ICO ban, other world-leading economies are taking a fresh look into how the cryptocurrency world should / can be regulated in their regions. Rather than banning ICOs, other countries still recognize the technological benefits of crypto-technology, and are looking into controlling the market without completely stifling the growth of the treaties. The big issue for these economies is to figure out how to do this, as the alternative nature of the cryptocurrencies do not allow them to be classified under the policies of traditional investment assets.

Some of these countries include Japan, Singapore and the US. These economics seek to establish accounting standards for cryptocurrency, mainly in order to handle money laundering and fraud, which have been rendered more elusive due to the crypto-technology. Yet, most regulators do recognize that there seems to be no real benefit to completely banning cryptocurrency due to the economic flows that they carry along. Also, probably because it is practically impossible to shut down the crypto-world for as long as the internet exists. Regulators can only focus on areas where they may be able to exercise some control, which seems to be where cryptocurrency meet fiat treaties (ie the cryptocurrency exchanges).

While cryptocurrency seem to come under more scrutiny as time progresses, such events do benefit some countries like Hong Kong. Since the Chinese ICO ban, many founders of cryptocurrency projects have been driven from the mainland to the city. Aurelian Menant, CEO of Gatecoin, said that the company received "a high number of inquiries from blockchain project founders based in the mainland" and that there has been an observable surge in the number of Chinese clients registering on the platform.

Looking slightly again, companies like Nvidia have expressed positivity from the event. They claim that this ICO ban will only fuel their GPU sales, as the ban will significantly increase the demand for cryptocurrency-related GPUs. With the ban, the only way to obtain cryptocurrency mined with GPUs is to mine them with computing power. As such, individuals looking to obtain cryptocurrency in China now have to obtain more computing power, as opposed to making straightforward purchases via exchanges. In essence, Nvidia's sentiments is that this is not a downhill spiral for cryptocurrency; in fact, other industries will receive a boost as well.

In light of all the commotion and debate surrounding cryptocurrency, the integration of the technology into the global economies seems to be materializing hastily. Whether or not you believe in the future of the technology, or think that it is a "fraud ... that will blow up", the cryptocurrency rollercoaster is one worth your attention.

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Source by Daryl Sit