attributed the surge in the trading volume of the Japanese Bitcoin exchange market to the exit of Bitcoin traders in China.
But, it seems as if traders are not willing to take any chances with the Chinese government and their unpredictable nature. The Chinese Bitcoin exchange market’s daily trading volume has halved within a period of three days, from 15 percent to less than seven percent.
According to various trusted Bitcoin market data providers such as CryptoCompare, China only accounts for 6.4 percent of global Bitcoin trades at the time of reporting.
bbCryptoCompare shows that Japan accounts for over 50% of all #bitcoin trades. Chinese traders have already moved to Japan. China less than 7% pic.twitter.com/t7YRaL5jv3— Joseph Young (@iamjosephyoung) September 17, 2017
US market benefits
Prior to the nationwide Bitcoin exchange ban by China, the US exchange market had consistently secured its position as the largest market in the world.
However, almost immediately after the announcement of the country’s three largest Bitcoin exchanges, BTCC, Huobi and OKCoin, were released, traders moved over to the Japanese Bitcoin exchange market. The abrupt migration of traders led to the short-term surge in the trading volume of Japan, allowing the market to overtake the US by over 20 percent in global Bitcoin exchange market share.Contrary to many negative reports, prominent developers, analysts, researchers and experts within the cryptocurrency and Blockchain sectors including Litecoin creator Charlie Lee and billionaire investor Tim Draper expressed their optimism toward the shutdown of the Chinese Bitcoin exchange market. Lee emphasized that the Chinese government will no longer be able to manipulate the market, as it had done since 2013.
“This is a good thing. China can no longer play with the markets by banning Bitcoin. Cryptocurrency cannot be killed by any country. One solution to centralized exchanges is decentralized ones. I hear the Decred Project team has something cooking that helps with that.”
As Lee emphasized, the exit of the Chinese Bitcoin exchange market should really only have affected around 10 to 15 percent of traders in the global Bitcoin exchange market. Yet, speculators and impatient traders initiated a major sell-off as the Chinese government banned exchanges, leading to a major correction on Bitcoin price.
It is likely that as Lee and Draper noted, the closure of the Chinese Bitcoin exchange market could lead to the stabilization of the global Bitcoin exchange market, which may be beneficial for Bitcoin in the long run.