follow FTSome Chinese investors are circumventing China’s crypto ban by turning to decentralized exchanges (DEXs).
Additionally, some argue that authorities cannot stop DEXs and DeFi because they are designed to facilitate interaction without the need for a centralized intermediary.
“How can the authorities stop me when this industry has grown to avoid centralized control?”
After tough crackdown by the Chinese authorities in May, the crypto industry has got into limbo.
The process of banning cryptocurrencies in China in 2021 | Source: Coin68
However, since then the United States has risen to the top as a popular destination for miners, and the rebounding Bitcoin price shows that we are through the worst.
Chinese authorities say the overarching ban is necessary to protect the environment from harmful emissions and end energy-wasting practices. They also draw links between cryptocurrencies and financial fraud and terrorism.
However, others speculated that the motive behind the ban was to promote the upcoming digital yuan. By destroying the adversary, China’s digital currency has a wider range of uses.
Either way, as China’s 2018 ban on fiat-to-crypto exchanges demonstrated, investors will find a way to bypass the law.
Some say that Tether (USDT) dominance over the stablecoin market is mainly being used by Chinese investors and they are using over-the-counter trading to bypass the crypto conversion ban.
And so, Chinese investors have used DEX and P2P to replace CEX. Will the Chinese authorities achieve their goal?
Research by on-chain analytics firm Chainalysis shows that previous government actions have reduced the volume of cryptocurrency transactions in China.
“The global market share of Bitcoin trading in China peaked at 15% in November 2019 and dropped to 5% by June 2021.”
However, China remains the most active crypto market in Asia with a trading volume of 256 billion US dollars in June 2021. The figures show that 49% of this is via trading on the DeFi platform, therefore Uniswap is currently the second largest exchange in East Asia ( by volume).
The latest ban has prevented new entrants from entering the market, said Deng Jianpeng, director of the Center for Financial, Science and Technology Research at the Central University of Economics and Finance in Beijing. However, experienced investors are not affected by the ban.
“But there will always be some people trying to find new investment opportunities, such as using an offshore platform or through DEXs.”
Join Bitcoin Magazine Telegram to keep track of news and comment on this article: https://t.me/coincunews
Mr. Teacher
According to Cryptoslate
Follow the Youtube Channel | Subscribe to telegram channel | Follow the Facebook page
BlockDAG crosses $170.5M in presale success with BDAG250 bonus and Whitepaper V3 launch! Solana grows…
Discover why Qubetics, Toncoin, and XRP are the best coins to invest in right now.…
Over the years, meme coins have evolved from inside jokes into serious investment opportunities.
Discover BlockDAG's five-tier bonus program's closing phases that enhance buyer holdings. Gain insights on the…
Discover why Qubetics, Solana, and Cardano are redefining the crypto landscape. Learn about milestones, price…
Discover why Qubetics, NEAR Protocol, and Immutable X are the best altcoins to join today,…
This website uses cookies.