“I don’t care”: traders continue to trade cryptocurrencies in China
Chinese cryptocurrency traders turn to the over-the-counter (OTC) market to circumvent China’s bans. Even after the country says it will crack down mining and Bitcoin trading, investors are looking for ways to get around the chase and continue to trade the cryptocurrency.
According to Bloomberg, traders have been using OTC since exchanges were banned in China in 2017. With the new bans, usage has intensified. After all, this type of negotiation offers more privacy and makes it difficult to track transactions.
However, with negotiations taking place on OTC platforms, it will be more difficult for authorities to impose a massive ban.
Consequently, this “maneuver” may positively influence the price of Bitcoin, which fell after the crackdown announcements, but as we reported, bitcoin price is recovering after China new cryptocurrencies ban.
An investor identified as Charles told Bloomberg that he does not care about the Chinese repression, nor about the recent losses resulting from the fall of the BTC.
The real estate consultant, who lives in Shanghai, said he has been buying cryptocurrencies since 2017. With the recent drop, he said he lost $11 million in 3 days, but that’s not a problem:
“To me it’s giving back the profits I made in the past few months,” he said. “I’m looking at the 10- to 20-year horizon.”
Still according to Bloomberg, OTC negotiations are difficult to track, as they involve different stages. First, traders publish their offers on OTC platforms operated by companies like Huobi and OKEx.
After the dealers reach an agreement, the buyer uses a different payment platform to send yuan to the seller.
Cryptocurrencies remain in the custody of the platform until the payment is released. And then they are transferred to the buyer.
Precisely because of the difficulty in tracking these transactions, China has issued an alert to payment institutions not to offer cryptocurrency services to users.