Home / Archive / Bitcoin Reaches All Time High at BTC China

Bitcoin Reaches All Time High at BTC China

Last Updated May 5, 2023 8:40 AM
Andrew Quentson
Last Updated May 5, 2023 8:40 AM

Bitcoin triumphantly rises once more, reaching an all-time high today at around 2PM London time in one of the most liquid exchanges: BTC China.

Proclaimed dead or worthless so often by so many, the currency has been turning heads in the past few weeks when a two years long bull market accelerated around December the 20th, increasing bitcoin’s price from around $800 to almost $1,100 in just two weeks, while at BTCChina it reached an all-time high of just under $1,150 (7,990 CNY according to BitcoinWisdom) higher by almost 400 points than its previous all-time high of 7,588 CNY reached on the 25th of November 2013 at a time when BTC China was the most liquid bitcoin exchange.

Bitcoin Reaches an All Time High of 7,990 CNY at BTC China

OkCoin and Huobi, the current leading exchanges with daily trading volumes in the millions also nearly reached all-time high, falling short by just 5 or 7 CNY. At the Chinese rate, bitcoin is now just a few dollars short of gold parity, an historical event as no currency has been valued as much as or more than the oldest money in existence, gold.

What is driving this stratospheric rise no one can say for certain. ZeroHedge seems to believe that it is mainly in response to capital control  measures in China which has devalued its currency to its lowest level in years. Among one of the arguments to support their conclusion is the volume of Chinese exchanges, but another explanation for their far higher volume levels may be that Chinese exchanges have no trading fees and are the only ones to provide significant margins, thus making them the exchanges of choice for traders and speculators worldwide.

However, trading volumes have significantly increased recently across the board, leading ZeroHedge to constantly warn that the Chinese may institute a crackdown on bitcoin to better enforce capital controls. Such measures would significantly affect China’s image in the west which has enjoyed considerable good press in this space. Moreover, it would probably jeopardize their attempts to promote blockchain innovation and attract more talent, something they appear to take seriously as shown by the inclusion of blockchain technology on their five-year plan. Furthermore, bitcoin mining, largely concentrated in China, directly contributes half a billion or more to their economy. Established or new miners might start leaving the country for neighboring and just as cheap venues if their government is seen as highly unfriendly to blockchain technology.

The fear of Chinese capital controls is speculatively driving investors to bitcoin.

Although there are rumors that China is looking to take restrictive measures, it is doubtful they would work or that the benefits of such measures would be more than the direct cost to the significant mining industry or more indirect cost of the country creating an image of unfriendliness to blockchain innovation.

It is more likely that China has now learned from the significant strategic advantage the foresight of UK’s government gave to Britain when in 2014 they embraced Fintech symbolically shown by the then Chancellor buying a bitcoin.

Nonetheless, bitcoin remains volatile and has many risks in investing or trading. China might indeed, despite good sense, enact highly restrictive measures just as the continued amateurism of some exchanges might bring the party to an end.

Disclaimer: All of the above is pure speculation with none of it constituting any advice. I am not a financial expert and you rely on any of the above solely at your risk and discretion. Price goes up and down, therefore you may gain or lose your investment.  

Images from Shutterstock. Chart from BitcoinWisdom.