Bit Yawns

Bit Yawns in China

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Despite waning in global popularity, the bitcoin crypto currency is still holding a leading position in China. According to a research report from Goldman Sachs, about 80% of bitcoin transactions take place in Chinese yuan. The US dollar is the second most-used currency for transactions, followed by the euro, the bank said. However, there is a large gap between the leaders. Thus, over the past six months China’s renminbi accounted for 77% of total market share, compared with 19% for the greenback and 1% for the euro. Bitcoin made it big on the global financial market, turning to be a promising monetary instrument from an experimental and “fun” project created by a programmer. Its price rose to the tune of $1.145.

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However, central banks of many countries including the Chinese one did not cheer its success. The People’s Bank of China said it is almost impossible to have control over bitcoin transactions so it threatens the stability of the country’s economic system. This dealt a major blow to the bitcoin’s price sending it to a nosedive. As a result, the e-currency is trading at $300 or $200, which is only 18% of its peak value last year. Interestingly, despite the PBOC banned financial institutions to use the crypto currency, bitcoin activity in China is great. Experts say that the bitcoin’s stability is likely to increase in spite of a decline in its price. So it is too early to say it is doomed to failure, at least in China.

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