It is evident some major changes have come to Chinese bitcoin exchanges over the past few days. With quite a few platforms being unable to honor withdrawals in a timely manner, consumers and traders will look for other solutions. The companies not affected by delays see a much higher bitcoin price compared to competing platforms. Interestingly enough, prices on LocalBitcoins in China are spiking upwards right now due to less liquidity on the market.
Any changes coming to the bitcoin market can have a negative impact, albeit that has not been the case in China so far. To be more specific, the withdrawal delays affecting so many cryptocurrency exchanges have not crashed the bitcoin price. Albeit there has been a big dip about 48 hours ago, things appear to have stabilized for the time being. Interestingly enough, the Chinese bitcoin price is lower compared to the global market average right now.
Several exchanges are now dealing with withdrawal delays, which can range anywhere from 48 hours to 30 days. OKCoin used to be one of the largest Chinese bitcoin exchanges, yet the price on that platform has fallen about US$40 below the current global average. Their volume is also on the decline, which is not entirely surprising. Traders will shift to platforms where there are little to no withdrawal delays, after all.
This shift is already taking place, as Yunbi and BTC38 have seen a small increase in their daily volume over the past 2 days. Neither of these platforms is hindered by significant withdrawal delays, which means they are one of the more prominent platforms to buy and sell bitcoin right now. HaoBTC is on this list as well, albeit their new 5% deposit fee will turn off quite a few cryptocurrency enthusiasts right now.
What is even more peculiar is how the LocalBitcoins prices are evolving in China. Albeit it is only to be expected one should pay a slight premium over the market average when using LocalBitcoins, things are starting to get out of hand, The average premium price is about 800 Yuan over OKCoin’s price, and close to 600 Yuan over the price on Yunbi and BTC38. With less liquidity on Chinese exchanges right now, these prices are expected to go up even further.
One thing users have to keep in mind is how the tides are changing in China right now. Traders used to rely on OKCoin and Huobi to check the market demand for cryptocurrency in the country, yet neither of those platforms represents the actual market demand as of right now. That is a good thing, though, as more decentralization is a positive development for bitcoin as a whole. Relying on two exchanges to gauge bitcoin demand in China seemed a bit wrong in the first place.
In the end, it remains to be seen how the markets will evolve over the coming weeks. The bitcoin price has held firm so far, although there is still a bit of unrest to be noted all over the world. China is no longer in charge of dictating the global average value of bitcoin, though. Then again, a decentralized currency should not have its free market dictated by one nation in the first place.
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