Bitcoin pressures from the Chinese government are pushing traders to search. This shows that even though there are threats, Chinese traders will not easily give up the cryptocurrency space.
Chinese traders are looking for new ways to deal with Bitcoin
As the Chinese government tries to suppress and regulate the cryptocurrency space as much as it can, traders continue to look for new avenues. The newfound path is OTC trading desks, also referred to as the over-the-counter market. Now Chinese traders are avoiding regulatory oversight by using OTC trading desks.
According to a report published today by Bloomberg, there has been a significant increase in the use of the OTC platform by Chinese traders, as China tightened restrictions that prohibit financial institutions and payment companies from providing cryptocurrency-related services.
According to Bloomberg, the USDT/CNY rate slumped as much as 4.4% after the Communist Party crackdown earlier this month. But after some time after the raid was involved, it made up more than half of that loss.
The recovery indicates that the peak selling may have passed as markets begin to consolidate.
On the other hand, it is stated that one of the reasons for the Chinese administration to apply serious Bitcoin pressure is to prevent capital outflows. Bloomberg opens the door a bit at this point, suggesting that OTC trading may not pose the same capital flight risks associated with typical exchanges, and that regulators may not be as strict when dealing with the industry.
The report also stated that the risk of large-scale capital outflows is extremely low, as the yuan leg of OTC transactions takes place entirely within China’s domestic financial system.