How two countries helped drive the recent rise in cryptocurrency prices

Digital currency prices have soared recently, with reports from the past few months showing enormous valuation increases for currencies across the board.Bitcoin, Ripple, and Ethereum have all experienced exponential growth, with Bitcoin prices rising to $2,588, Ripple reaching a market cap of nearly $10 billion, and Ethereum growing to a total market cap of over $20 billion.

Ability to Withdraw in China?

With access to cheap hardware and electricity, China is the prime breeding ground for mining cryptocurencies, with huge mining pools run by exchanges such as BTCC accounting for more than 60% of the bitcoin network’s collective hashrate.

However, the beginning of 2017 saw a governmental crackdown of Chinese-based digital currency exchanges, causing a suspension in all withdrawals, causing the market to suffer heavily with China being one of the top bitcoin markets in terms of trading volume.

Recently, Caixin reported potential changes in the governmental regulatory framework to allow withdrawals last month, specifically mentioning top exchanges OKcoin, Huobi, and BTCC. This potential good news has increased consumer confidence in cryptocurrencies, contributing to their associated rise in value.

Governmental Acceptance of Cryptocurrency

It is no secret that the Chinese government has taken steps to regulate digital currency transactions, with their scrutiny and initiatives causing a drop in bitcoin prices to around $1,000 just several months ago.

However, the very fact that the PBoC is seeking to regulate this industry simply proves how viable it is as a legitimate transaction entity, with the Chinese government even taking steps to build their own digital currency.

With the announcement of potential withdrawals of bitcoin on the horizon, the PBoC have just completed a trial run of their own digital currency based on blockchain technology, with participation from major institutions such as the Bank of China and the Industrial and Commercial Bank of China, as well as China’s first online bank WeBank.

The Japanese government has also taken huge steps in the acceptance of digital currencies as legal forms of tender, with Japan legally classifying bitcoin as a form of payment just on April 1st.

Ahead of China, Japan has already begun licensure procedures for digital currency exchanges, to be operated under the watchful eye of the government’s Financial Services Agency, with market leaders such as bitFlyer already announcing plans to apply for said license, further driving investor confidence in the Japanese market and beyond.

Additionally, the Japanese government announced that the sale of virtual currency under the new Fund Settlement Law would be exempt from the Japanese Consumption Tax (8%), further driving bitcoin growth as an investment vehicle.

The acceptance of virtual currencies by both the Chinese and Japanese governments are driving cryptocurrency growth, with China on the cusp of establishing its own currency, and Japan regulating bitcoin as true legal payment.