As many of you remember, Bitcoin had some of its greatest days before the announcement that the Chinese government had banned the exchange of Bitcoins for Chinese currency. Since the Chinese government banned the exchange of RMB (Renminbi), also known as Yuan, the biggest exchange in China, BTCCHina was forced to no longer accept any sorts of deposits from people in order to exchange BTC for cash, etc.
However, they now claim that their understanding of the Chinese government’s ruling specifically pertains to banks themselves and not exchanges where people already have transferred money out of their bank accounts and into the exchanges. Because the BTCChina exchange does not act as a bank in any way, they believe that they are not subject to the Chinese government’s new rule that caused them to stop accepting deposits. This ruling actually resulted in a huge drop of the Bitcoin’s price in the hundreds of dollars because China is such a huge market of users.
Now, nobody questions the timing of this move as Chinese New Year starts today and many Chinese people, including officials will be off probably for the next week or so. As a result, we likely won’t see any reactions to BTCChina’s move until late next week or the following week. The good thing is that because it is Chinese/Lunar New Year, there will likely be less volume in the exchange, and as a result it won’t cause any ridiculous spikes in BTC volume or price. However, I do believe that there is also a chance that there could be a huge buyup immediately following the Lunar New Year because of the amount of people who are traditionally given money for the New Year.
As always, it will be a wait and see approach, but this is a definite positive thing for the Bitcoin movement and cryptocurrencies in general when you consider the whole negativity that was around the arrest of two Bitcoin exchange owners of BitInstant for money laundering.