The value of a bitcoin has now passed $1,000 as China-based exchanges find ways to get around last month's regulatory decisions.
China shores up bitcoin valueLast month, bitcoin buyers in China were told they wouldn’t be able to use digital payment platforms to put cash into exchanges. In essence, that regulatory decision barred Chinese from buying bitcoins. The main reason the price of bitcoin came crashing down was because of demand in China, so this renewed demand has naturally caused the price of the digital currency to inflate once again. Simon Rabinovitch of the Financial Times reports that major bitcoin exchanges have come up with some ways to get around the regulatory decision in China, some of which are “in legal grey areas.” BTCtrade, still reportedly uses a third-party payment system even though links like this one have been banned by Chinese regulators. A representative for the company said their payment provider hadn’t officially received a regulatory notice, so it was still active.
Looking for bitcoin loopholesA number of other major bitcoin exchanges have looked around for some loopholes. Huobi, which is based in Beijing, allows direct deposits from users right into its own corporate bank account. The exchange even allows them to deposit cash into the personal account of founder Li Lin. From there, the company then takes the cash into its exchange to buy bitcoins. Li told the Financial Times that what they are doing is “totally legal.”
Smaller exchange OkayCoin has devised a workaround similar to what Huobi is using. However, BTC China has created its own workaround.