Crypto proponents have regularly criticized China for its close-mindedness towards innovation as the country has been averse to Bitcoin ever since its run-up in the year 2017. However, when Michael Gu (Blockchain expert and cryptocurrency analyst) sat down with the head trader at Genesis Block, Charles, the revelations differed from the popular opinion.
Charles gave Gu an insider look into the institutional crypto economy of Hong Kong. As per Charles, Beijing’s cryptocurrency related regulatory actions are not as bearish as they appear.
Gu asked Charles if Chinese investors have played a massive role in the crypto world’s recent downward trend. Charles contradicted the regulations enforced by the Chinese government against Bitcoin and cryptocurrencies and said that his firm, Genesis Block, can maintain its relationships with Chinese clients as flow from the mainland is one of the strengths of the Hong Kong-based firm. Charles went on to add that China has many high net worth individuals who have overseas accounts. He reiterated the fact that China’s regulatory crackdown on the cryptocurrency market has not been very useful.
Charles highlighted that even though the Chinese government has taken harsh measures against crypto such as banning crypto-related social media, yet the nation remains one of the most liquid crypto markets in the world. Charles illustrated that the trading in the crypto market is not going under the Chinese government’s nose. Wu elaborated on this aspect, saying:
“So they know what’s happening, but then they just [say] ‘you know what, just don’t talk about it’, so that’s why we’re getting this media blackout, so then we have fewer people willing to take a stance to talk about China. It’s taboo now and all the funds [don’t want to say anything]. Then the East/West divide is actually getting bigger because everyone believes that China is out of the picture [in crypto].”
Charles seconded Wu’s opinion, saying that although it is hard to gauge the capital routed through OTC platforms, one cannot deny that China is a huge market.