Accelerate deleveraging, charge for transactions, central bank aims to cool down Bitcoin

Reporter Sun Zhong○Editor Chen Yu

China's Bitcoin transactions officially entered the charging stage today.

According to announcements from Huobi, OKCoin and BTC China, the three major domestic Bitcoin trading platforms will start charging fees starting at 12:00 noon on the 24th. The era of free Bitcoin trading in China has officially come to an end.

Accelerated deleveraging and transaction fees, behind the ever-changing situation in China's Bitcoin market, the central bank's intention to control financial risks and protect investors' rights and interests is gradually becoming clear.

The two-way charging rate is far higher than the stock market

On the 24th, 13 days after the central bank conducted on-site inspections, the three major domestic bitcoin trading platforms all started charging for transactions. Huobi, OKCoin and Bitcoin China’s announcements were basically the same, basically clarifying that they would charge transaction service fees in both directions from 12:00 noon on the 24th, and the service fee would be charged at a fixed rate of 0.2% of the transaction amount.

This also marks the beginning of the charging journey for the world's largest Bitcoin trading market.

At present, the trading volume of Huobi, OKCoin and BTC China alone has long accounted for 80% of the global Bitcoin market.

As soon as the news of the fee came out, the market weakened, and the price of Bitcoin fell directly from 6,500 yuan to around 6,000 yuan. As of press time, the price of Bitcoin was consolidating around 6,300 yuan. Although the price of the currency successfully held the 6,000 yuan mark, investors were generally cautious.

"The stock market charges only 0.05% on one side, but why does Bitcoin charge 0.02% on both sides? It's really impossible to play." An investor complained to the reporter. In his opinion, the reduction in liquidity will directly affect operations. Data from a certain platform shows that the current daily trading volume is 1/10 of the previous high of 8,000 yuan.

The impact is even greater on quantitative trading teams. As the three major Chinese trading platforms previously did not charge transaction fees, quantitative robot trading has emerged in large numbers. Data shows that Huobi alone has robot quantitative trading accounting for 80% of the total transaction, or even higher.

"We charge fees in both directions, one for buying and one for selling, and it's 0.4%, which is too expensive. In the future, all high-frequency trading will be abolished, and cross-platform price arbitrage will no longer be possible." The head of a quantitative trading team told reporters.

Assume that the price of Bitcoin on OKCoin is 6,300 yuan, and on Huobi.com it is 6,305 yuan. Because Bitcoin can circulate freely on various platforms, you could buy Bitcoin on OKCoin and sell it on Huobi.com to earn a 5 yuan difference. But now you must have a 24 yuan difference to make a profit.

“In the future, we can only optimize strategies, improve accuracy and reduce the chances of stop losses,” the person in charge said.

However, there are also views that robot quantitative trading cannot provide too much liquidity. From the recent trend of the coin price after the sharp drop, it is not obvious that robot trading provides sufficient liquidity. "There are too many robots at present, and a batch of them need to be eliminated. At present, most of them are 'brick-moving' robot trading." A trader said.

Central banks aim to cool Bitcoin speculation

"From the information released so far, it can be seen that the central bank is working hard to cool down the overheated Bitcoin market," a person from a platform revealed.

The day after the Bitcoin price crash, the central bank interviewed the main persons in charge of several Bitcoin trading platforms. The content involved the attributes of Bitcoin that the market generally cares about, emphasizing that it is a commodity rather than a currency, and focusing on the risks.

On the 11th, the central bank entered a number of platforms for on-site inspections, investigating whether the platforms were operating beyond their scope, whether they were conducting credit, payment, foreign exchange and other related businesses without permission or licenses, whether there was any market manipulation involved, the implementation of the anti-money laundering system, and potential financial security risks.

Judging from the current measures of various platforms, the intention to "deleverage" and cool down transactions is obvious.

First, the margin trading and lending business was suspended, which is a leveraged business similar to stock trading and margin trading. Since the platform does not charge transaction fees, providing financial derivative services has become the main source of income. "Margin trading and lending is one of the important sources of profit for the platform." said the above-mentioned platform personnel.

The full charging from the 24th is a correction to this problem. Through transaction fees, on the one hand, it alleviates the dilemma of the sharp decline in platform income, and at the same time, it also makes the overheated market sentiment that overemphasizes transactions tend to calm down, and leveraged transactions are difficult to turn back. Secondly, Bitcoin financial management has also been stopped. With the suspension of Bitcoin financial management, Bitcoin derivative services have been completely stopped. Therefore, Bitcoin has now become a relatively simple non-leveraged market, and there is no possibility of sharp rises and falls in the short term.

"The central bank's investigation is currently at its end, and we don't know if there will be further information released in the future. It feels like the central bank may still issue regulations to regulate the entire market." The above-mentioned platform person revealed. THE_END

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