Chinese traders look to buy more cryptocurrencies after restrictions
Even after the recent crackdown on China’s crypto-mining and trading industry, some traders and investors are still bullish, saying they are buying the dip rather than dumping their digital assets, Bloomberg reports.
Before bearish news emerged from China, Bitcoin was trading at $48,000. But after the People’s Bank of China announced that it would confiscate all crypto-related transactions, including digital assets and securities, and ban cryptocurrency exchanges that allow citizens to trade and maintain accounts abroad, the price of bitcoin dropped to $42,000.
Large exchanges such as Huobi and Binance have stopped operating in the country and have banned the opening of new accounts for users of mainland China. Hong Kong users can still open new accounts.
While China’s mining industry is largely stifled by restrictions, some cryptocurrency traders and investors who have previously experienced “China Bans Bitcoin” are happy to buy the cryptocurrency at a high discount.
Ballet Global Inc. CEO, Bobby Lee, stated that he bought some cryptocurrencies after the initial drop. After hitting a local low of $40K, Bitcoin almost immediately jumped to nearly $45,000.
Several traders from China told Bloomberg that there are still various options for buying cryptocurrencies, including OTC trading desks and some centralized exchanges. The policies presented are neither new nor surprising, which is related to the general reaction to the actions of the People’s Bank of China.
Positive market sentiment is confirmed by Bitcoin price action. The cryptocurrency recovered a bit after the drop but is currently heading towards $41,900 and trading on it. According to a Bloomberg source, a potential ban on holding digital assets will likely not be imposed due to the decentralized nature of cryptocurrencies, making it technically impossible to seize or block them.