How Does The Bitcoin Chinese Market Affect the Bitcoin US Market?

More than 30% of all bitcoins traded everyday, originates from China. Today, China is the home of more than 20 big bitcoin trading exchanges including BTC China, BTCTrade, BtcTradeChina, OKCoin and others. Together with the US market, the Chinese market accounts for more than 80% of the trading that takes place between bitcoin and fiat currencies. Crypto-economists have long wanted to understand the relationship that exists between bitcoin's Chinese and US markets.

I came across a recently published study that examined the relationship between US and Chinese market and I wrote an article about it for Livebitcoinnews.com. The researchers obtained BTCRMB (Bitcoin to Yuan) price data from Btctrade.com, BTCUSD (Bitcoin to US Dollar) price data from blockchain.info and USDRMB (US Dollar to Yuan) exchange rate from the Chinese CSMAR database. The below chart shows the BTCRMB price throughout the study period.

The findings of the study are pivotal as it was proven that the Chinese market price movements can affect price movements across bitcoin's USD markets. Oppositely, volatility transmission goes the other way around, so volatility across the US market is usually transmitted to the Chinese markets.

For more details, kindly refer to the original paper.