Right now, Bitcoin and the entire altcoin market is taking a beating.
It's not even a guess as to what is causing the selling pressure, it is very clear.
China came out a few weeks ago and banned ICOs.
Upon first glance that seems like it would be good news. The ICO markets have been awash with fraud and shysters after the quick buck. A good cleansing of those markets would be great for the industry.
However, China wasn't done yet.
Soon there after, rumors started circulating that China would soon be shutting down all the domestic cryptocurrency exchanges over there.
As you can image that news was quite scary and the prices of most cryptocurrencies have been trending lower ever since.
Then today we got some verification on those rumors as news came out with very credible sources that says China will indeed shut down all the local exchanges by September 30th.
Some scary news indeed!
Now that we have some of the backstory out of the way, here is why I don't think it is that big of a deal.
China currently is/was roughly 15% of the entire cryptocurrency markets in terms of volume.
Not an insignificant amount but also not the entire crypto markets either.
Also, the OTC markets for Bitcoin etc will remain open.
That means that the wealthy in China will still have the option of owning Bitcoin through the OTC markets if they so desire.
Then there is the black-market which I am sure a few will gravitate towards to get their hands on some coins.
However, the big reason why I think now is a buying opportunity is because the selling pressure is market dynamics related and not fundamentals related.
What I mean by that is that the Chinese exchanges have been told that they will be shut down by September 30th, which means they only have a few weeks to liquidate their entire holdings otherwise they risk being "stuck".
That is exactly what we are seeing today.
Investors in Chinese exchanges are trying to sell everything they can, while they can.
That is not a fundamental change with Bitcoin or the crytpocurrency space, it is a one time event.
For that reason I think that any weakness in Bitcoin, Steem, or any of the other major crytpocurrencies is a buying opportunity over the next couple weeks.
I don't think this Chinese news is permanent.
I think most likely the Chinese government will figure out ways to regulate virtual currencies much better and then once they have a better handle on things they will reopen the cryptocurrency exchanges that have the proper licensing etc.
When that happens, it will likely be another "gold rush" type of event in the cryptocurrency space again as those exchanges will again be buying everything in sight trying to build up their inventory.
Those are my thoughts at least.
Stay safe out there my friends.
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