Bitcoin rate reacts to decisions of country regulators
The current position of the cryptocurrency may support the bitcoin rate
Despite the bans, members of the crypto community are finding ways to interact with cryptocurrencies
International consortium of news organizations developing transparency standards.
Strict regulation and a total ban on the circulation of cryptocurrencies are regarded by community members as the main risk factor.
In the next two years, bitcoin may suffer due to attempts to regulate the digital asset market and or ban cryptocurrencies in state-owned countries pose the greatest risks to bitcoin (BTC). This is the opinion of the majority of subscribers of the popular analyst PlanB, the author of the S2P cryptocurrency forecasting model..
The risks to Bitcoin only come from within. Unlikely to kill it, but the risks are now determined by Bitcoiners, I’d say these things slow it down and reduce its potential.
– codebase / technical risks
– maximalism ignoring innovations
– Willy Woo (@woonomic) August 30, 2020
The PlanB post was commented on by another popular analyst in the crypto community, Willie Wu. In his opinion, all risks can only slow down the development of the cryptoindustry. He believes that no obstacle can completely destroy the digital asset market. At the same time, Willie Wu noted that technical problems, lack of attention to innovation and a toxic atmosphere in the crypto community can also negatively affect the speed of industry development..
The market reacts to bans by falling
The reaction of the cryptocurrency market to adverse decisions by governments confirms the results of the survey. For example, when the Chinese authorities banned the trading of digital coins and conduct ICOs, the bitcoin rate went down.
The red oval marks the reaction of the bitcoin rate to the regulatory measures taken in the PRC. Chart: TradingView
Many predicted a collapse of Bitcoin, against the background of a number of regulatory bans introduced in China, but the forecasts did not come true. A couple of months later, the Chicago-based Cboe exchange launched BTC futures, and the rate of the first digital coin reached all-time highs. China, in turn, retained its leading position in the bitcoin mining market.
BTC hashrate distribution map. Data: cbeci.org
Interest in digital coins remains high
Meanwhile, Chinese traders have switched to stablecoins. According to a CoinMetrics study, Tether is the most popular coin in East Asia. The demand for a digital asset can be explained by the fact that many Chinese use stablecoin to bypass the bans on crypto-fiat trading involving the yuan.
In Russia, interest in bitcoin correlates with the value of the cryptocurrency. BTC was bought most actively for rubles when the coin was at its highs.
The volume of purchases of bitcoins for rubles and the BTC chart. Data: LocalBitcoins and TradingView
Recall that at the end of July 2020, Russian President Vladimir Putin signed the law “On digital financial assets”. It will enter into force on January 1, 2020. Under the new legislation, cryptocurrencies will receive legal status in Russia. However, users will not be able to use them for calculations. Against the background of the regulation of the crypto industry in Russia, the volume of purchases of bitcoins for rubles showed an increase. Learn more about the crypto laws of the Russian Federation from our material.
The situation in America looks different. The growing interest of US citizens in buying bitcoins for dollars is ahead of Russia’s indicators. The maximum indicator, as in the case of the Russian Federation, was recorded at the end of 2017 – during the period when BTC reached record heights. At the moment, there is a positive trend, which has intensified against the background of the decision of the US authorities to allow national banks to provide trust services for cryptocurrency.
Can Government Regulate Bitcoin?
Bitcoin purchase volume for USD and BTC chart. Data: LocalBitcoins and TradingView
Against the background of financial instability, many investors began to view bitcoin as an asset to preserve their savings. Perhaps the interest of users in BTC as a savings instrument will strengthen the position of the cryptocurrency in the market and support its rate in the event of negative regulatory decisions by the governments of the countries..
We will remind, earlier experts shared with the editorial board of BeInCrypto their opinion on how much Bitcoin will cost on December 31, 2020.
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