The bitcoin price rise on Chinese exchanges is not a result of Chinese capital controls policy, says Bobby Lee, the Founder and CEO of BTCC.

 Although one could speculate that buying bitcoins is an easy way to get around the law which prohibits sending more than the equivalent of $50,000 out of the country, the true reason for the bitcoin price rise is simply the growth of public interest and the increasing number of users, Lee says.

Another reason is the global turn of regulator’s policy and funding in favour of bitcoin, says Leon Li, CEO of Huobi. “More financial institutions entered this industry,” he said, “such as bitcoin-based ETN and ETF.” In the USA CFTC says bitcoin is a commodity, and in Europe courts say it should be exempt from VAT. At the same time, according to Li, Chinese banking industry is still applying high transaction fees, which stimulates interest to bitcoin.

This week witnessed the highest rise of bitcoin price in a year. After having been in a bear market for the past 18 months, the three biggest bitcoin exchanges in China, OKCoin, Huobi and BTCC, have shown dramatic growth in both bitcoin price and trading volume, OKCoin having the maximum volume of BTC 1.24m on 30 October. On 4 November the price of bitcoin surpassed the mark of $500, which is the highest price since autumn 2014, before collapsing below $400.

Alexander Tankhilevich