The majority of bitcoin transactions carried out over the last 30 days came from yuan trades, it has been revealed.
China-based exchange BTC China tweeted that a total of 71% of bitcoin trades last month could be attributed to yuan users – the Chinese market, in other words.
— BTC China (@btcchina) September 5, 2014
The exchange cited data from bitcointy, which indicates that the majority of transactions were carried out in yuan. Second place goes to the US dollar, with euro transactions trailing at a distant third.
Turning the tables
This particular chart does not paint the full picture, however. To better illustrate China’s impact on the market, it is necessary to look at data prior to September 2013. A year ago the dollar was the dominant currency, but that started to change in late 2013, as the volume of CNY transactions exploded.
In September 2013, approximately one CNY trade was carried out per three USD trades. At the moment, the situation is quite different, as CNY accounts for more than two thirds of all deals and on most days it outpaces the dollar by a ratio of at least 1:3.
It should be noted that BTC China launched USD and HKD trading accounts last July.
Further, most of China's exchanges have adopted 0% fee models for trading, which provides a potential explanation as to why yuan trade may be disproportionately high.
China’s impact on bitcoin
China’s effect on bitcoin prices and the network itself should not be underestimated. The nation is home to some of the biggest bitcoin exchanges on the planet as well as a number of industrial-scale mining operations.
Notably, turbulence in China's bitcoin market has been shown to have a visible effect on the wider industry.
Earlier this year, the market was affected by moths of uncertainty, as rumours mounted that the People’s Bank of China (PBOC) would move to ban the currency. Although operations were disrupted, the fears subsided in April, but not before the price of bitcoin took a dive in late March as international traders reacted negatively to the news.
Though the PBOC took no formal action against bitcoin businesses, only reinforcing early December statements meant to separate the country's bitcoin businesses from its financial industry, the uncertainty had a profound effect on domestic exchanges, with a few smaller startups closing their doors.
CNY/USD image via Shutterstock
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.