China Enforces Bitcoin Trading Fees
Events in China tend to have a massive effect on the bitcoin community. Not only is it one of the largest markets in the world and the most populous country, the majority of the world’s bitcoin minersi sit behind the great firewall. By recent measure, 70% of bitcoin’s mining capacity and 90% of all trades take place in China. This means moves in the People’s Republic ripple out into the bitcoin community in a big way.
Recently, these moves have come from the government of China. The yuan has been struggling and the government is doing everything it can to prop up its own national currency as well as its economy. So, while one hand is adding to the debt and attempting to stimulate growth (to the tune of 1 Trillion yuan), the other hand is working to control the movement of capital to prevent it from leaving the country. Part of this effort led to officials becoming very interested in bitcoin as one of those potential exit points.
The regulators kept the community in suspense for some time as they met with the countries three largest exchanges. So far, it seems as though they have no interest in hindering bitcoin in a serious way. Chinese exchanges have halted margin trading with the goal said to be preventing volatility in the markets. More recently, they’ve also done away with ‘Zero-Fee’ trading. It’s a light touch to be expected of a government that claims to view bitcoin usage as the people’s right. Let’s hope it stays that way.
[i] Bitcoin mining is what gives bitcoin its democratic nature; computers all over the world are responsible for processing and verifying transactions. It is the owners of these computers, more than anyone else, who determine how bitcoin functions. If they decide to support a certain update, it moves forward. If they refuse, it doesn’t happen. These miners also hold all new bitcoins that are created so they hold a certain sway in the community as well. As of this writing, roughly $3.3 million USD is distributed to miners every day. These miners are, essentially the blood and bones of bitcoin.
Social Media Profiles