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Why China is leading the global rise of Bitcoin

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Re: Why China is leading the global rise of Bitcoin

#11

Post by wmf »

hayksaakian wrote: post #7
apalmer wrote: post #6

Earlier quoted context omitted.

His slant seems pretty obvious... Even if he ends up being wrong the logic is self evident. Communist China is a totalitarian state, Communist China crushed another virtual currency that caught on a couple years back, therefore if the raise from ~$100 a bitcoin to ~$600 is due to chinese involvement you probably should assume its gonna go back to ~$100 as soon as the communist government flexes its muscles.

The real question is: can then even do anything about a decentralized currency?

China drove up the exchange rate 3x; what makes you think they couldn't drive it right back down?

Re: Why China is leading the global rise of Bitcoin

#13

Post by Amadou »

gmays wrote: post #8

If you look into China's real estate market they've invested billions to build cities...empty cities. They continue to build because citizens' investment options are limited, so real estate is one of the few "attractive" options. So they end up with ghost cities full of unoccupied office buildings, condos, malls, etc. Crazy, right? And now they have bitcoin to put their money into. That's a large part of what's drivi…

And you know what? It'll keep going. If they're willing to invest billions in ghost cities they're willing to drive bitcoin above $10,000.

I think that is an unfounded conclusion. The ghost city phenomenon is a lot more than just "no other investment vehicles." The process of building ghost cities is ripe with corruption, everybody in the chain gets a cut of what is ultimately land-confiscation and government funded construction loans.

Straight out bitcoin speculation isn't even in the same league of opportunities for corruption.

Re: Why China is leading the global rise of Bitcoin

#14

Post by bernatfp »

VMG wrote: post #12

Fun fact: btcchina is trading at ~5400CNY/BTC right now, which is approximately $880 while the average on other exchanges is $700. Good day for arbitrage. btcchina: http://bitcoinity.org/markets/btcchina/CNY bitstamp: http://bitcoinity.org/markets/bitstamp/USD

I have noticed that this is happenning with other Chinese exchanges such as OKcoin and FXBTC as well. There must be a reason why this arbitrage exists. It's probably the difficulty to close the loop between cashing out in RMB and funding your account on Bitstamp with €/$.

Meanwhile the safest way to do arbitrage is between BTC-E and Bitstamp because they both have low fees for SEPA deposits/withdrawals. Must be European though.

Re: Why China is leading the global rise of Bitcoin

#15

Post by panarky »

VMG wrote: post #12

Fun fact: btcchina is trading at ~5400CNY/BTC right now, which is approximately $880 while the average on other exchanges is $700. Good day for arbitrage. btcchina: http://bitcoinity.org/markets/btcchina/CNY bitstamp: http://bitcoinity.org/markets/bitstamp/USD

Good point. As I write this, BTC-China is at 5680 RMB, or 932 USD. Bitstamp is 655 USD, Gox is 776 USD.

Maybe China is driving the demand and other exchanges are arbitraging against China. Since there's a lag in transferring funds into exchanges, the 20% to 40% premium in China may just be a measure of latency in a fast-moving market.

If so, then we'll see the prices converge over time, and we should use BTC-China as a leading indicator of exchange rates.

Re: Why China is leading the global rise of Bitcoin

#17

Post by fleitz »

gmays wrote: post #8

If you look into China's real estate market they've invested billions to build cities...empty cities. They continue to build because citizens' investment options are limited, so real estate is one of the few "attractive" options. So they end up with ghost cities full of unoccupied office buildings, condos, malls, etc. Crazy, right? And now they have bitcoin to put their money into. That's a large part of what's drivi…

Imagine a country where 1 million extra housing units only represented 1/1300th of the housing needs for the nation. Imagine someone having built 625 extra apartments in SF.

China is trying to urbanize 300 million people, a ghost city here or there is a drop in the bucket.

Re: Why China is leading the global rise of Bitcoin

#18

Post by bernatfp »

panarky wrote: post #15
VMG wrote: post #12

Fun fact: btcchina is trading at ~5400CNY/BTC right now, which is approximately $880 while the average on other exchanges is $700. Good day for arbitrage. btcchina: http://bitcoinity.org/markets/btcchina/CNY bitstamp: http://bitcoinity.org/markets/bitstamp/USD

Good point. As I write this, BTC-China is at 5680 RMB, or 932 USD. Bitstamp is 655 USD, Gox is 776 USD. Maybe China is driving the demand and other exchanges are arbitraging against China. Since there's a lag in transferring funds into exchanges, the 20% to 40% premium in China may just be a measure of latency in a fast-moving market. If so, then we'll see the prices converge over time, and we should use BTC-China as…

FWIW, if you are seriously into arbitraging, you won't keep transferring funds between both exchanges to finish the cycle of buying-selling. What you will actually do is having half of your funds on both sites and execute both operations on both sites at the same time to have them match.

Re: Why China is leading the global rise of Bitcoin

#19

Post by gigq »

bernatfp wrote: post #18
panarky wrote: post #15

Earlier quoted context omitted.

Good point. As I write this, BTC-China is at 5680 RMB, or 932 USD. Bitstamp is 655 USD, Gox is 776 USD. Maybe China is driving the demand and other exchanges are arbitraging against China. Since there's a lag in transferring funds into exchanges, the 20% to 40% premium in China may just be a measure of latency in a fast-moving market. If so, then we'll see the prices converge over time, and we should use BTC-China as…

FWIW, if you are seriously into arbitraging, you won't keep transferring funds between both exchanges to finish the cycle of buying-selling. What you will actually do is having half of your funds on both sites and execute both operations on both sites at the same time to have them match.

Yep, that's the only way to do it with zero risk. But since btcchina.com is consistently higher than the other top exchanges you'll eventually have to move CNY out of there and bitcoin in. Moving bitcoin there is trivial (which shows how great bitcoin is) but moving CNY out and converting it to USD for the other exchanges is trickier (need a Chinese bank account for example) so I would expect the lag in price to continue.

Re: Why China is leading the global rise of Bitcoin

#20

Post by bernatfp »

gigq wrote: post #19
bernatfp wrote: post #18

Earlier quoted context omitted.

FWIW, if you are seriously into arbitraging, you won't keep transferring funds between both exchanges to finish the cycle of buying-selling. What you will actually do is having half of your funds on both sites and execute both operations on both sites at the same time to have them match.

Yep, that's the only way to do it with zero risk. But since btcchina.com is consistently higher than the other top exchanges you'll eventually have to move CNY out of there and bitcoin in. Moving bitcoin there is trivial (which shows how great bitcoin is) but moving CNY out and converting it to USD for the other exchanges is trickier (need a Chinese bank account for example) so I would expect the lag in price to cont…

Exactly, that's the point I've raised in another comment. By the way, I've read that Bobby Lee (CEO @ BTCChina) is already dealing with Chinese authorities to see if he can expand the business out of China (read: accept €/$). Can't wait to see this happen as well as seeing Litecoin integrated there.
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