The Bitcoin price has always been subject to a lot of speculation and expectation. It is rather difficult to predict how cryptocurrency valuations evolve these days. Now that Chinese exchanges are no longer offering leveraged margin trading like before, things are looking very good. Contrary to what some people expected, Bitcoin’s price has not diminished. In fact, the value has gone up again now that market stability has been achieved.
It should come as no surprise to anyone the recent changes among Chinese exchanges have been positive. When the PBOC initiated their investigation, cryptocurrency enthusiasts showed signs of concern. A lot of people assumed this would be the first step towards regulating Bitcoin in China. Although there are some consequences to this investigation, things have only improved.
With leveraged margin trading no longer a factor in China, and trading fees being reintroduced, things are looking quite good. In fact, the appetite for cryptocurrency in China is not diminishing. Instead, it appears the market is showing signs of future price gains. Over the past few days, Bitcoin’s price has been gaining some momentum once again.
Further Bitcoin Growth Expected
It is true the PBOC took a keen interest in Chinese exchanges, but for the right reasons. The organization wants to ensure Chinese investors are not burned by a bursting bubble. In the long run, that is a positive outcome, as it helps stabilize the cryptocurrency market as a whole.
In fact, BTCC CEO Bobby Lee echoes this sentiment, as he stated the following:
“Given that China has a serious capital flight problem, the PBOC got worried that if Bitcoin were to become too popular, it would actually be used for that. However, the PBOC had another fear that is rarely talked about. They don’t want Chinese people getting hurt when a bubble crashes As a result, the PBOC created a unit to investigate and break the coverage of the Bitcoin price increase. The PBOC went to the exchanges, gave all of them a slap on the wrist, and asked for apologies. Then they released a statement to the press to break the cycle.”
Eliminating margin trading is the most positive outcome for cryptocurrency as a whole. Even though the price took a nosedive once the investigation launched, things have recovered since. It is evident the Bitcoin price trend will continue where it left off in 2016. Experts predict a future price increase over the next few weeks is very likely. It is unclear if this means we will see US$1, 100 again soon, though.