In January 2017, China’s financial authorities started cracking down on cryptocurrency institutions with a ban on cryptocurrencies against the yuan conversion on mainland exchanges. It began with crackdowns against domestic bitcoin exchanges. But since cryptocurrency markets showed some improvements in the last forty-eight hours, industry insiders also noticed that Chinese yuan (CNY) has been making a comeback into the cryptocurrency ecosystem.
Bitcoin trader Anton Pagi tweeted on March 17 that the current Bull Run has been stoked up by Chinese Yuan. “Something to watch during this bull run, Chinese profits from their roaring stock market in recent weeks flowing into Bitcoin,” Pagi tweeted detailing his observations. “Largest Chinese exchange has more than doubled volume in past week.”
According to media reports, crypto enthusiasts are hoping to see the start of crypto spring after a long cold winter with a sudden resurgence in the market since last few days. In the last few weeks, Localbitcoin crypto trade volumes have been seeing an upward trend. In just twenty-four hours on March 16, digital currency markets captured $33.7 billion. The same week, China’s major stock indexes closed near their 6-1/2-month highs. CNY volumes touched a high of 25.4 million yuan ($3.7 million) in trades during the two weeks.
Other cryptocurrency data collection sites tell the same story. Paxful, the peer-to-peer trading platform, displayed an exceptional increase in CNY/BTC trade volumes after the lows last month. The data and price website, Coingecko also observed a jump in CNY/BTC volumes during the previous 24 hours. Statistical website coinlib.io shows $161.3 million worth of CNY flowing into BTC markets followed by $74.1 million into CNY/ETH and $19.7 million value of CNY/XLM trades.
Presently, there are twelve to fifteen exchanges, all located offshore, where Chinese investors can approach for cryptocurrencies. Most popular of them right now are Hitbtc, Zb.com, Binance, and Fatbtc which observed increased traffic since Coinex revealed it would no longer serve customers from mainland China.
The Chinese government has come up with a few additional monetary policy measures that they hope will support economic growth this year. Premier Li Keqiang has pledged to cut taxes and deregulate the tech industry in order to boost China’s slowing economy. However, crypto speculators believe that Chinese investors are not careful enough with respect to cryptocurrency investments.