China’s crypto holdouts: Bitcoin nodes and OTC desk are struggling
There are still a handful of bitcoin nodes hanging in China and OTC trading is viable, but it probably won’t be for long.
Despite Beijing’s ever-increasing crackdown on the crypto industry, there are still some signs of life in the People’s Republic in terms of bitcoin networks and OTC trading.
China last week tightened its ban on crypto in an effort to suppress any remaining activity related to digital assets within its borders. The government specifically targeted crypto transactions, but as researched by Cointelegraph, this action is not new in the last decade or so with at least 19 similar crackdowns.
Despite the latest moves, there are still 135 bitcoin nodes operating in China, according to Bitcoin statistics that count nodes by geographical location. However, this is only 1.21% of the total 11,262 bitcoin nodes spread across the planet. If they are working behind a Virtual Private Network (VPN) and / or using onion routing with Tor that masks location
Bitcoin nodes are software that run protocols, including a section with a complete ledger or transaction history. Distributed and decentralized systems are specifically designed to make it difficult to shut down completely so that the government can struggle to extinguish those working through these last few hangers-on or tor.
While it is difficult to put numbers on the voice due to its opaque nature, over-the-counter (OTC) trade, like the local currency pair, is also gaining a foothold in China.
Local media outlet Wu Blockchain reported that the RMB / USDT pair, which is still offered by major exchanges such as OKEx and Huobi, is trading at a premium. He recorded panic sales last week, which then declined.
OKEx is currently paying 6.35 Yuan for 1 USDT whereas the actual exchange rate for Greenback is 6.47 according to XE.com.
OTC trades are peer-to-peer that interfere with bank use or spot markets on centralized exchanges जरी although many exchanges have corresponding OTC desks. According to Coindance, volumes in China have been relatively stable since the beginning of 2020, with about 7 million yuan (about US $ 1 million) traded weekly on the P2P platform Localbitcoins.
Bobby Lee, former CEO of BTCC, China’s first crypto exchange, thinks Beijing will target the OTC desk in its next crackdown. Earlier this week, he said OTC platforms run by large exchanges would be shut down or forced to exclude Chinese users. Speaking to Bloomberg on September 29, Lee added:
There is another FOMO rally in the BTC market that could push prices up to ,000 200,000, he predicted.