Cryptocurrency’ Rocky Streets: China’s ICO Prohibit

In the wake of China’s ICO ban, what befalls the planet of cryptocurrencies?

The greatest event in the cryptocurrency world recently was the declaration of the Chinese authorities to power down the exchanges on which cryptocurrencies are traded. Consequently, BTCChina, one of many largest bitcoin exchanges in China, said so it will be ceasing trading activities by the end of September. This news catalysed a sharp sell-off that left bitcoin (and other currencies such as for instance 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 so it can cryptocurrencies can cure the recent falls. Josh Mahoney, a market analyst at IG comments that cryptocurrencies’ “past experience tells us that [they] will more than likely brush these latest challenges aside” ;.

However, these sentiments don’t come without opposition. Mr Dimon, CEO of JPMorgan Chase, remarked that bitcoin “isn’t going to work” and so it “is just a fraud… worse than tulip bulbs (in mention of the the Dutch ‘tulip mania’ of the 17th century, recognised as the world’s first speculative bubble)… that’ll blow up” ;.He goes to the extent of saying that he would fire employees who have been stupid enough to trade in bitcoin.

Speculation aside, what’s actually going on? Since China’s ICO ban, other world-leading economies are taking a fresh look into how a cryptocurrency world should/ can be regulated in their regions. Rather than banning ICOs, other countries still recognise the technological advantages of crypto-technology, and are looking into controlling the marketplace without completely stifling the growth of the currencies. The serious problem for these economies is always to work out how to get this done, as the choice nature of the cryptocurrencies don’t allow them to be classified beneath the policies of traditional investment assets.

Some of those countries include Japan, Singapore and the US. These economies seek to ascertain accounting standards for cryptocurrencies, mainly to be able to handle money laundering and fraud, which have been rendered more elusive because of the crypto-technology. CashTab Yet, most regulators do recognise that there is apparently no real benefit to completely banning cryptocurrencies because of the economic flows they carry along. Also, probably because it is practically impossible to power down the crypto-world for as long as the net exists. Regulators can just only give attention to areas where they could have the ability to exercise some control, which is apparently where cryptocurrencies meet fiat currencies (i.e. the cryptocurrency exchanges).

While cryptocurrencies seem ahead under more scrutiny as time progresses, such events do benefit some countries like Hong Kong. Considering that the Chinese ICO ban, many founders of cryptocurrency projects have been driven from the mainland to the city. Aurelian Menant, CEO of Gatecoin, stated that the organization received “a large number of inquiries from blockchain project founders located in the mainland” and that there has been an observable surge in the number of Chinese clients registering on the platform.

Looking slightly further, companies like Nvidia have expressed positivity from the event. They claim that this ICO ban is only going to fuel their GPU sales, as the ban will more than likely boost the demand for cryptocurrency-related GPUs. With the ban, the only way to acquire cryptocurrencies mined with GPUs is always to mine them with computing power. Therefore, individuals looking to acquire cryptocurrencies in China will have to acquire more computing power, instead of making straight purchases via exchanges. Basically, Nvidia’s sentiments is that this isn’t a downhill spiral for cryptocurrencies; in fact, other industries will receive a boost as well.