All Chinese Exchanges May Stop Trading, Crypto Crash Continues

dashforcenews.com5y ago

All cryptocurrency exchanges in China may soon stop trading, news which has had a heavy negative impact of the cryptocurrency markets.

As reported by Washington Post researcher Luna Lin, Chinese regulators have required that exchanges make plans to shut down by the day’s end:

Correction: not stop trading by end of today but decide by the end of today when they would stop trading. — Luna Lin (@LunaLinCN) September 15, 2017

The resulting uncertainty has caused the cryptocurrency markets to crash, dropping from a combined market cap of $134 billion on Thursday to a recent low of $97 billion on Friday. This is down from a high of $179 billion at the beginning of the month. Dash fell to a recent low of $220 (down from a late-August high of $409), and Bitcoin fell to $2,946 (down from a high of just under $5,000).

Exchanges will begin the process of shutting down

As a result of the regulatory crackdown, Chinese exchanges are making plans to stop trading. Yesterday, BTCC announced that it would cease trading by the 30th of September after carefully considering the regulatory announcement earlier this month. While it intends to keep its mining pool operational, ViaBTC announced today that it would similarly shut down, with registration closing on the 25th and the website itself shutting down on the 30th.

According to Bitmain co-founder Jihan Wu, some of the larger exchanges may remain operational longer because of their size and the logistics of shutting down:

Huobi and Okcoin got a rough permission to delay the shutting down process. Because they are too big to shut down immediately. — Jihan Wu (@JihanWu) September 15, 2017

A rough path to end the “China liability”?

While the collapse of Chinese exchanges has been rough on cryptocurrency users, it has the potential to help inoculate the market against future crashes from localized regulatory pressure. News from China long held disproportionate sway over the crypto markets, and future news may have a less significant effect.

Additionally, trouble from centralized exchanges can cause larger portions of the market to flow through decentralized and peer-to-peer trading platforms. This would lead to greater censorship resistance in the markets, a prime selling point of using cryptocurrency to begin with.