OTC crypto trade returns to China

OTC cryptocurrency trade in China appears to be very much alive despite the regulations
26 September 2017   671

It’s been quite a tough time for the cryptocurrency community due to the whole China-against-Bitcoin thing, as a result of which the top cryptocurrency price has fallen. On top of that, according to undisclosed sources, the Chinese government has officially decided to crack down on all Bitcoin and cryptocurrency trading, not just commercial exchanges. However, this was not the end of the restrictions. Beijing News reported that executives of Chinese Bitcoin trading platforms may not leave the country, per industry insiders. 

Yet, it seems like cryptocurrency is here to stay. This week, as reported by ethnews.com, over-the-counter (OTC) trade in Chinese yuan reached an all-time high on LocalBitcoins, demonstrating how peer-to-peer economies continue to overcome heavy-handed institutions.

For now, OTC cryptocurrency trade remains legal and unrestricted. The peer-to-peer platform is emblematic of Bitcoin itself, as citizens have bypassed government to transact with one another directly.

Weekly LocalBitcoins volume on coin.dance Weekly LocalBitcoins volume on coin.dance

During the week, the volume of Chinese yuan exchanged on LocalBitcoins reached an all-time high. According to coin.dance, last week on LocalBitcoins, the exchange of more than 115 million yuan (approximately $17.4 million USD) could be seen. On top of that, over the last two weeks, global volume on LocalBitcoins has also reached all-time highs. 

Bitcoin price charts on coinmarketcap.comBitcoin price charts on coinmarketcap.com

Meanwhile, at the time of writing, Bitcoin price is about $3908.84, its market capitalization is $64,841,890,061, which allows the cryptocurrency to hold the first place in the list.

German Financial Regulator Clarifies Stance on ICOs

The Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin) has clarified its position on ICOs
22 February 2018   52

German financial regulator admitted it was receiving many inquiries about the status of tokens and cryptocurrencies. According to an advisory letter, BaFin provides some basic definitions of ICOs and related terms. It is important because the results of a new survey showed that more than two-thirds of Germans know about bitcoin.

In this letter, BaFin educates the public and explains how tokens are typically generated, how blockchain works and that ICOs are used to raise funds for startup projects. The note states that for regulatory purposes, ICOs, tokens, coins, and cryptocurrencies are subject to the existing provisions in the field of securities supervision and other relevant national and EU laws.

The authority advises participants in ICOs to check and follow rules applicable to regulated financial instruments, such as securities. If businesses or individuals have any doubts about regulations, they should approach BaFin.

According to BaFin, companies should fulfill any obligations under the Banking Act and the Capital Investment Code, the Insurance Supervision Act and the Payment Services Supervision Act. The transactions may be prohibited if relevant regulatory requirements are not met.

The authority also states that legal classification of tokens requires precise examination. It will determine their status on a case-by-case basis after studying their features. The token should be transferable and tradable on cryptocurrency trading platforms in order to be classified as a security.