Has China Stopped Selling Bitcoin? – Trustnodes
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Just as Shanghai was waking up on December the 4th, bitcoin panicked, plunging $10,000 in a couple of hours to $42,000 from $53,000.
On the 26th of November, the Shanghai sell off went onto European trading hours, down from $59,000 to $53,000.
On the 16th of November, it is China again that brought it down from about $64,000 to $60,000, but this Sunday they’ve given us a bit of green during Shanghai 9AM, from $46,500 to $48,000.
That follows a flat trading day on Friday in China that led to our theory of a potential trend reversal, perhaps because at least one exchange is done with China.
“Deposit services for Mainland China users will cease at 03:00 (UTC) on Dec 14. At 03: 00 (UTC) on Dec 15, spot trading for Mainland China users will be disabled, and all pending orders will be canceled. Withdrawal services will be kept open,” Huobi said in October.
There are suggestions Huobi has gone from having 332,000 bitcoin about two years ago, to now just 12,500 BTC.
Some of it is due to a general trend for all exchanges as we get new users who withdraw to defi or their cold wallet, but Huobi is thought to have 15 million Chinese users. A significant amount of it thus is likely because they’re closing the service to them.
The reason for this religious compliance with PBOC orders is thought to be because Huobi’s co-founder, Li Lin, is in China and won’t leave.
Some sources say Leon Li is barred from leaving, citing ‘border restrictions,’ while Li himself has said his family and children are in China and apparently they don’t want to go abroad.
The other co-founder Du Jun has left to Singapore, with that being Huobi’s new headquarters as one of the oldest crypto exchange starts a new life without China.
Binance’s Customer 2 Customer (C2C) platform “will delist the CNY trading zone” on New Year’s Eve, but unlike Huobi or OKEx, Binance was never native to China and this C2C platform came somewhat late in the game.
Binance thus is thought to have very few Chinese users, with Changpeng Zhao, its founder, stating:
“In 2017, Binance.com the website was blocked by the Chinese firewall. This time around, in the last couple years or so, even SMS messages to Chinese mobile numbers, like the two-factor verification codes, do not get through. Email verification to any of the Chinese email software providers gets blocked.”
In addition unlike Huobi, OKEx was never welcomed back to China while Huobi opened a new HQ there last year and some offices in 2019.
Huobi thus is the biggest exchange to close services to Chinese users, while many smaller ones closed their service last month.
All suggesting that this is largely over, but probably not the cat and mouse game with Chinese media kind of ignoring all this as they focus on the metaverse.
The Bitcoining Goes On
Bobbe Lee, the founder of a now forgotten exchange that used to be the biggest in China, BTCC, said at the beginning of the month:
“The 2021 China crypto ban actually has delayed enforcement. The China exchanges (Binance, Huobi, OkEx) all have until this month (Dec) to fully de-register their Chinese clients & force withdraw coins. Once done this could be the ultimate catalyst for upward BTC price movement!
Maybe that’s why the hotly anticipated year end bull market hasn’t taken off yet. Waiting for the last hammer to drop in China!”
There has been some hush hush implicit public and prominent criticism in China against their decision to kick out bitcoin miners.
The state media boasts instead about some Chinese bitcoiners being the richest men in their nation in a clear sign that tensions between their central bank, PBOC, and the state government continue.
China’s government has not passed any law that prohibits ownership of bitcoin itself, including its buying and selling at an individual level.
PBOC however has passed numerous diktats aimed at keeping bitcoin adoption from going mainstream in the world’s second biggest economy.
So culturally there’s a mixed picture as in the west, although with a bigger iron fist in China, where old bankers seethe while the young find it all very cool.
Thus practically we expect nothing to quite change in China. One exchange has gone, and maybe a few others, but a thousand more will pop up.
These ‘exchanges’ will be smaller, more agile, more nimble, less noticeable, and yet just as effective if not more than the ones now gone.
Because Shanghai will never stop the crypto party, especially now when we’re entering a very new stage that is set to upgrade the internet itself.
Because China, its people, will not be left behind as they know where we’re going and they like it very much.
They’re just keeping their heads down, let it cool, let the gestapos go away. Then, turn the music on again.
Goodbye China thus, and hello China too. We know you never left, but we’ll pretend you just did do as in our head we sing a hymn to the biggest underground festival in the world where they sing:
‘Mr gestapo, let the children play. Mr gestapo, ours and yours the day. Mr gestapo, we’re the techies hey. Mr gestapo, turn and go away.’
From an investment perspective there would have clearly been some speculative value in China about this change in infrastructure, and since it is now largely completed, presumably that speculative value will change too.
It may well be thus the price moves were more due to that speculative element about that change, rather than due to an actual material change, which might explain why bitcoin tends to come back even stronger after every PBOC diktat so far.
As the CCP is not proposing to arrest bitcoiners, which would mean Elon Musk would be barred from the country as he is a bitcoiner, this latest move materially appears to be more an increase in the intensity of enforcement as Chinese exchanges have been banned for now five years.
During that time we’ve periodically gotten ‘closures,’ with this being the most prominent such episode because PBOC asked offshore Chinese exchanges to stop serving Chinese users, yet arguably that is the most difficult of measures to enforce and arguably the punishment is just a fine.
So we expect the bitcoining to go on, certainly in the medium term and certainly in sophisticated finance and technology outlets, but how all this develops exactly remains to be seen.
Cryptocurrency
