After banning all transactions related to ICO, China relinquished its crown to Japan as the country with the largest Bitcoin market.
Early this month, China, known as the world’s leading contributor to the cryptocurrency market, made an announcement ordering the immediate termination of all initial coin offering (ICOs) and other related crypto-funding activities. This was a move that suddenly made Japan‘s exchange market the largest Bitcoin market in the world today.
With Bitcoin traders leaving China following its Central Bank’s orders, Japan’s market share of the global Bitcoin exchange market rose to 50.75 percent, as reported by Cointelegraph. This shift saw China’s global share dropping to below 7 percent, and analysts attribute this to the ongoing cryptocurrency mess in the country.
China down to 8 prc and soon it shall become zero pic.twitter.com/EbPOFXtKeG
— George Kikvadze (@BitfuryGeorge) September 17, 2017
China’s desist order that was handed down to all digital currency exchanges and platforms gave them until the end of September to halt their operations. However, OKCoin and Huobi, two of the country’s largest exchanges were granted by the government leeway to operate until October 30. Local news outlet Caixin cited the duo’s lack of ICOs as the reason for the extension.#Japan now holds the largest #Bitcoin market share in the world today!Click To Tweet
“Because the two platforms have large numbers of users and have not performed ICO operations, the relevant departments have given Huobi and Okcoin a one-month buffer period to stay open until the end of October before shutting down,” the paper reported.
Still, the consideration didn’t help to retain China’s standing as the largest Bitcoin market.
Japan as the Country With the Largest Bitcoin Market
While many digital currency analysts believe that the Chinese government would still allow token sales under stricter measures in the future, it appears that traders are not willing to take the risk.
Just three days following the announcement, the Chinese Bitcoin market’s daily trading volume dropped to less than 7 percent, more than half of the recorded 15 percent daily trading volume. To date, CryptoCompare, one of the most trusted Bitcoin market data providers, reported that China now only accounts for 6.4 percent of the global Bitcoin market.
— Joseph Young (@iamjosephyoung) September 17, 2017
The abrupt changes in China’s Bitcoin market and migration of cryptocurrency traders also saw Japan overtaking the United States by over 20 percent in the global Bitcoin exchange market share.
Despite the many negative reports earned by Bitcoin nowadays, well-known personalities, developers, and analysts within the blockchain and cryptocurrency sector are showing optimism toward the decision of China to shut down its Bitcoin exchange market. Among those who expressed their enthusiasm are billionaire investor Tim Draper and Litecoin creator Charlie Lee.
“This is a good thing. China can no longer play with the markets by banning Bitcoin. Cryptocurrency cannot be killed by any country. One solution to centralized exchanges is decentralized ones. I hear the Decred Project team has something cooking that helps with that.” –Charlie Lee
This is a good thing. China can no longer play with the markets by banning Bitcoin. Crypto-currency cannot be killed by any country.
— Charlie Lee (@SatoshiLite) September 14, 2017
Lee, also emphasized that China’s exit from the Bitcoin market would only affect around 10 to 15 percent of traders in the global Bitcoin exchange market. Experts are also positive that the Bitcoin exchange market will stabilize in the weeks to come as traders settle down in South Korea and Japan.
Some experts also believe that China’s banning of ICO has something to do with the Chinese government’s current development of its own cryptocurrency. In July this year, Neowin reported that the People’s Bank of China was already testing the said virtual currency. However, China has not made any official statement about the matter until now.