Experienced by the United States, South Korea, China, Japan and other major regulatory agencies on the digital currency a series of intensive suppression, digital money investors are fleeing.
Since the beginning of 2018, digital currencies such as bitcoin have suffered a cliff-like decline, with bitcoin prices having dropped 30% in the past two weeks and have dropped more than 50% from the $ 20,000 high of December last year. Beijing at 23:00 on the 4th, Bitfinex reported 8640 US dollars (about 54,400 yuan).
Xiao Lin learned bitcoin a year ago via a radio show, and soon he found that there are many bitcoin exchanges, and many of them have price differences.If you buy bitcoin cheaper at an exchange, Other exchanges sell at high prices, easy to make the difference Arbitrage - this method of making money in the industry commonly known as 'move brick' Because of bitcoin price fluctuations and differences is very large, Lin Xiao and his companions soon Accumulated a large fortune.
However, starting from September 2017, Lin Xiao became less fortunate as RMB transactions in virtual currencies such as bitcoin were halted by regulators such as the PBC, and soon Lin decided to open a bank in Hong Kong, China Account.
'Opened 4 to 5 bank accounts in a single breath to facilitate Bitcoin transactions.' Lin Xiao told CBN that his career as a brickmaker continues.
Many currency exchange points in Hong Kong accept bitcoin transactions. (Source: Network)
Despite the fact that the Hong Kong SAR government did not explicitly prohibit speculation in the virtual currency, the drop in bitcoin prices caused the disappointment of Lin Xiao in the past two months. In desperation, he thought of Hong Kong's understanding of the 'mining' life. Make money before that '.
'Mining' high cost not to make money
Wang Hua (a pseudonym) in Hong Kong was once a somewhat qualified 'miner'.
About two years ago, he and his friends bought dozens of 'mining machines' and officially opened up the 'mining' life.However, Wang Hua said simply saying that 'mining' means that when a transaction occurs, the network On the implementation of this computing program on the computer, will have to begin computing, the first computer to calculate the results, they will take the initiative to broadcast on the network has been calculated, the results are verified, you can get a new virtual currency and transaction fees As a bonus, the main source of revenue for miners is the virtual currency and transaction fees.
Wang Hua told CBI that the market value of virtual currency held in its hands has doubled in the first year of 'mining.' Wang Hua disclosed that most of the 'miners' will not sell out their virtual currency in large quantities Wealth can only be measured at market value, 'but I feel that my annual income is at least 8 digits. "Wang Hua said.
Eight digits, that is, tens of millions.
Wang Hua caught up with a good time, but as more and more people join the army of miners, the cost of mining is also getting higher and higher.
Another "miner" Li Qi (not his real name) entered the business a bit late, and he started mining only six months ago. Li Qi told CBI that the price of 'miners' in Hong Kong is now rising, such as bitcoin miners S9, the cost rose from 25,000 Hong Kong dollars half a year ago (about 20,000 yuan) to the current 33,000 Hong Kong dollars (about 26,600 yuan), the increase has reached 32%; and electricity and network fees and other maintenance costs monthly needs Above 1,000 Hong Kong dollars, basically a 'mine machine' costs a year at least 40,000 Hong Kong dollars.
Since 'mining' relies heavily on chances, most 'miners' will join the 'mining pool' to increase the chances of digging into virtual currency; at the same time, Pay the appropriate management fees, which is pushing up the cost of 'mining' one of the reasons.
Another hurdle at pushing the cost of 'miners' is the graphics card in short supply. "Game media Polygon reports that the price of some GeForce GTX 1070 graphics cards in some Nvidia models should have been around $ 380, but due to a shortage of inventory, More than 700 US dollars, or more than 80%.
Bitcoin Financial News Bitcoin Bitcoin co-founder Hu Jushan on the First Financial said the graphics card price from the original 1700 Hong Kong dollars rose to 4200 Hong Kong dollars, but also the status of long-term out of stock, if you want to buy a video card, has not set the first Quarter of the manufacturers supply, only the second quarter of supply, but also through a variety of relationships can be set.
'Now all the miners are missing cards,' said Hu Jushan.
Graphics card that is wealth, and now waiting for too many people, and other big shipments to the second quarter of the. (Photo: Bitcoin.hk official website)
In the process of rising costs, the 'miners' can only find another way, and many 'miners' simply open up the 'mining companies' to create new business models. "Hu said that there are many business models mining companies can have To help investors host 'mines' and charge custodian fees, the commission for management fees can reach double digits basically, but as the cost in Hong Kong is getting higher and higher, many mining companies have already moved the 'mines' to Southeast Asia to save electricity costs.
In fact, 16.8 million bitcoin has been mined as of January 13, 2018. According to the original Bitcoin original algorithm set by Nakamoto, the total amount of bitcoin is about 21 million pieces. Based on this, the total bitcoin supply The amount has been used up 80%, that is, at present only 20%, a total of 4.2 million bitcoin for mining.
Therefore, despite the weight of global regulation and the displeasure of large institutions, there are still some 4.2 million bitcoin to be mined at this limited remaining amount.
Trading platform Coinhills data show that in the past 24 hours, the global digital currency trading volume totaled 1.489 million bitcoin, or about 168.5 billion US dollars.
Due to the substantial increase in transaction volume, the current "miner's fee" for bitcoin transfers (ie, transactions) has risen from 3% to 5% of bitcoin.
Bitcoin Prospects Worry?
For example, Coulla, which claims to be 'the smartest mining company,' sells its own computing power, for example, they promised in a contract to 'mined' 150mh per second to customers, dug daily Of the virtual currency sent to customers in the form of reports, so that many investors can not buy their own 'mine machine' directly enjoy the 'mining' process However, Culla Wu Wei, marketing officer told First Financial, 'digging The mines do not really make money, especially since they were not established for a long time. What they really value is the ICO (First Token Distribution).
Similar to an IPO (initial public offering), ICO is a way to finance the development, maintenance, exchange of related products or services using blockchain to combine usage rights with cryptocurrencies, and if the mining company has excellent Of the technical team, then you can participate in ICO. After successful financing, you can earn a lot of service fees.
It is worth noting that ICO has long been halted by regulators in mainland China.
In its exchange with a number of mining companies, First Finance found that bitcoin is no longer the 'mine' that they are primarily looking for. Many companies are flirting with other virtual currencies such as Ethereum, Ripple) and so on.
Even though Ricci was late, but his main dig is the etheric ether, so the influence is not too big.At the time of bitcoin rise, the market value of etheric ether also soared, Li Qi said at that time the price of the etheric currency rose , They all look silly eyes.
Wu Ziwei told CBI that he is not technically optimistic about the future of Bitcoin, for example, bitcoin trading takes too long, takes as long as 10 minutes and sometimes takes more than two hours.
In fact, as early as five years ago, some people in Hong Kong started to engage in the virtual currency market. Many senior speculators started from bitcoin. In the past, there were no trading platforms and only over-the-counter transactions.
Mr Hu told CBN that he started to pay attention to the price of bitcoin in 2010 and found that bitcoin fell sharply each year but many investors were not experienced at the time and some investors even chose to drop once Selling all its bitcoins, but now that the market has stabilized as investors get more sophisticated, the recent volatility in bitcoin is far smaller than it had been despite recent bitcoin price volatility.
Hu Jun Yang believes that the short-term bit of bitcoin is in an adjustment stage with a support point of around $ 7582. If it falls through, the bitcoin price may drop to $ 3900. In the medium term, bitcoin may return to $ 15,000 in April To around $ 17,000 and may even be back to the $ 24,000 later this year.
Bitcoin moved from steepness to sharp decline since March last year (Source: Yahoo Finance)
Exchange into a hot land
In addition to the miners' all-out efforts, the virtual currency exchange has long been regarded as one of the key industries in the currency circle, so while global regulation is making tight control of virtual currency transactions, there are still many institutions that rush to this market .
Japan's chat software company Line recently announced plans to launch a virtual currency exchange. Line said in a statement on Wednesday that the Japanese financial regulator is reviewing the company's application for the operation of a virtual currency exchange.
Reporter also learned from insiders, after the two major domestic virtual currency exchange, fire coins network and OKCoin will also enter Japan and South Korea in the first quarter of this year, to seize the virtual currency trading market.
FireWun already announced that it will set up two exchanges with Japan's SBI Group: SBI Virtual Currency and Huobi Japan to jointly explore digital asset markets in Asia and the world. The new exchange will be available early in 2018 and will provide Currency transactions, yen transactions.In addition, according to insiders said fire yuan, is currently planning to set up the San Francisco office.
OKCoin, after shutting down its business in China last October, obtained a license to trade multi-national digital assets in the world through investment and cooperation, and formally entered the overseas market on the OKEx platform.
OKEx's latest move is the digital currency exchange to be launched in South Korea starting next month, and OKCoin has now set up its OKCoin Korea website, officially embarking on a digital currency pre-order, which is scheduled to offer over 60 digital currency won services.
However, Japan and South Korea's exchange market has also been a murmur recently, the risk of virtual currency exchange rose sharply, for example, on January 26, Japan's largest digital currency theft occurred in Japan, Japan's second-largest digital currency exchange Coincheck was Hackers steal nearly 500 million US dollars worth of new currency (NEM), the news triggered a huge market.
South Korea started implementing the real-name virtual currency trading system domestically from January 30, but the South Korean regulator still strictly regulated the domestic exchanges. For example, the official website of South Korea's Bithumb Exchange shows that due to the violation of the relevant laws in South Korea, the exchange has received Korea Communications Commission issued a correction order.
Regulated by the regulatory agency of the virtual currency
However, as Bitcoin prices plunged, Bank of America, Citibank and JPMorgan no longer allow customers to use credit cards to trade any virtual currency since February, limiting the influx of funds, all of which said Worried about the credit risk of customers who use digital credit to buy digital currency.
And Bank of America has another intention in its move, that is, to comply with anti-money laundering laws and regulations to prevent some illegal elements to steal customer credit cards, and then buy digital money directly.
In addition, the CME recently made it clear that it will not continue to launch digital asset derivatives, and CEO of CMEZ said that at present it has not introduced any other crypto-currency derivatives other than Bitcoin.
Recently, the Hong Kong SAR Financial Services and the Treasury Bureau and the Investor Education Center, a subsidiary of the Hong Kong Securities and Futures Commission, jointly launched a public education campaign on ICO (First Token Issue) and cryptocurrency to help the public to have a correct and comprehensive understanding of the participation of ICO And the potential risks of trading in encrypted currency.
CFO Deputy Commissioner Chan Ho-wan told First Financial that the media coverage of ICO and cryptocurrency mainly focused on the sharp ups and downs in prices, but on the contrary, investors' interest in cryptocurrencies increased. However, in fact, many investors may not necessarily Clearly understand the nature of cryptocurrencies and the underlying risks.
Leung Fung-yee, executive director of the Hong Kong Securities and Futures Commission Interim Department, said although the ICO is similar in form to the IPO, it is not regulated at the moment and there are no earnings, revenue and business records for start-ups participating in the ICO, and ICO does not have the assets to back it up as hard to do Valuation.On the other hand, the ICO will be accompanied by a white paper outlining the project's concepts, technologies, prospects, etc. However, these whitepapers often involve many jargon that is difficult for the average investor to understand and does not have an independent third-party objective audit The authenticity of such white papers will create a lot of confusion for investors.
As early as September 2017, the Hong Kong Securities and Futures Commission issued a circular stating that if ICO's digital tokens comply with the definition of 'securities', they provide trading services or provide advice on such digital tokens or manage or promote digital investments The funds of tokens may all constitute 'regulated activities.' Persons or organizations engaged in 'regulated activities', whether in Hong Kong or not, as long as their business activities are directed at the public in Hong Kong, are required to obtain the approval of the Hong Kong Securities and Futures Commission Licensed or registered with the SFC.
More than just mainland China and Hong Kong, Canada, the United States, and Japan both began tightening their regulatory hurdles last year: the Canadian Securities and Exchange Agency (CSA) issued a notification last August about the issuance of ICO tokens, which the ICO needs to reference In July last year, the SEC said that ICO tokens may be considered as securities and need to comply with the relevant regulations and remind investors to exercise prudent investment. In March last year, Japan demanded that a virtual Companies trading in currency and exchange of virtual currencies are required to register applications and provide relevant information.