BTCC chief Bobby Lee discusses China Bitcoin ban

There were recently rumours in the twittersphere that China's ban on trading Bitcoin was likely a temporary move and would be lifted sometime soon.

Asked his opinion on the ban, and rumours it might be lifted, BTCC chief Bobby Lee takes a sober view.

"I've heard variations of that rumour," he said, "I honestly don't think that will happen in any short time frame. In life everything is temporary, so if it gets lifted in five years or ten years, well technically they are right.

"But it's not in the time frame that we are thinking about – meaning two to three months. I don't believe it's a two to three months, even six months situation."

The ban on trading of all cryptocurrencies on China-based exchanges followed an initial ban on initial coin offerings (ICOs), a way of crowdfunding technology projects by issuing digital tokens, which dangerously skirt securities regulations (the tokens are seen a bet on the future profitability of a network yet to be built etc).

The putative ICO bubble is a global phenomenon, but perhaps China was seeing more than its fair share of speculators essentially gambling and trading these digital tokens. While the ICO ban was probably an intuitive move by China regulators, could it have offered the ideal excuse to curb Bitcoin?

Lee said: "It started as an ICO ban and then I think it's become a bigger story right; they wanted to ban the whole group.

"There are two things here: certainly the concept of whether or not to allow for Bitcoin trading in china – now that's been the debated issue, and essentially there are various perspectives. Some people want trading to continue; some people did not.

"But after the ICO ban I think it was just a simplicity aspect of not having to strictly differentiate between ICOs and tokens and traditional cryptocurrencies. So it's one clear sweep.

"Yes, ICOs have issues. They skirt investment in equity regulations by makes this feel like a token. I think in this case in China Bitcoin and Ethereum and traditional tokens, tradition cryptocurrencies, got caught in the cross fire."

Lee agreed this was heavy-handed, but said he was also sympathetic to the understanding of the regulators. "It's really hard for the layman to differentiate what is an ICO token, what's a traditional coin. Outside from Bitcoin, you have all these other altcoins – Litecoin, dogecoin, Ethereum, Ripple – so where do you draw the line?

"What is truly an ICO? Ethereum had an ICO but now it's recognised in the blue chips category.

"What they have done is the easy way. They took this chance to clean up the whole house for now. Things might change in the future, but we don't know how long and we don't know at what extent."

Lee added that cryptocurrency traders like to see the price to go up and go down. "For every side there is always a story to spin. And some people who spread the rumours might even say it's wishful thinking; to them it's not a rumour ... they really believe it will happen."

BTCC has long a stake in just about every part of the Bitcoin value chain, from mining to exchanges to wallets (the recently launched global currency wallet, Mobi has been a big success). So how has the ban affected its business model?

Lee said: "This is actually a great opportunity for us to focus on new things and new projects like Mobi. It was always been designed as a global wallet so this is a great chance for us to focus our resources and energy on something that's truly global and not something which is under one country's regulation."