For some unknown reason, China has been the biggest Bitcoin marketplace for many years now, despite the People’s Bank of China warning merchants not to deal with digital currency payments, for the time being. Many enthusiasts have always wondered why China remained the biggest Bitcoin trading market, despite there hardly being any use for spending Bitcoin. We now have an answer to that question, as China sees Bitcoin how most other people see it as well: an investment vehicle with tremendous potential for daytrading profits.
Taking A Gamble on the Bitcoin Price in China
Daytrading activities are nothing new in the world of Bitcoin and digital currency, as the speculative aspect of this new currency is omnipresent. While Bitcoin is often criticized for its price volatility, most investors are more than happy to ride the Bitcoin price swings to make a small or large amount of money every day.
Keeping in mind that Chinese exchanges are representing over half of the entire world’s Bitcoin trading volume every day, there is a lot of gambling taking place. Not gambling in the traditional sense, but more in terms of Chinese investors taking a gamble on the Bitcoin price and its volatility for that particular day.
Similar to how the traditional stock market works, the Bitcoin price lends itself towards daytrading opportunities. Even though there are days during which the price will barely move, moving large quantities of BTC back and forth will still generate quite a lot of money. A similar trend can be noted in both the US and Europe, albeit daytrading large amounts of money is more difficult in those countries due to regulatory and legislative restrictions.
“China will continue to have the world’s largest share of Bitcoin trading, Why is Macau the world’s largest gambling market? It’s not because Macau has the most casinos … it’s because Chinese are so interested in gambling!” – BTCChina CEO Bobby Lee told DigitalMoneyTimes a little while ago.
Bitcoin Adoption in China Is Still Years Away
Despite all of the gambling and trading action going on in the Chinese Bitcoin world, adoption of the digital currency is facing major struggles every day. As is the case with nearly every country around the world, lawmakers and policymakers are having a hard time coming up with proper legal definitions for Bitcoin and other digital currencies.
The biggest hurdle to overcome is the fact that Bitcoin is not subject to capital controls, creating a very unique and unprecedented situation in China. Additionally, there are the [incorrect] assumptions and concerns regarding Bitcoin as a way to fund illegal activities and even terrorism.
Regardless of all of that, Bitcoin is not going away by the looks of it. Interest by Chinese investors alone is more than enough to keep the digital currency relevant. Granted, this will have an effect on the Bitcoin price for many years to come, while also creating opportunities for new people to enter the ecosystem.
Source: CNN Money
Images courtesy of BTCChina and Shutterstock