Volatile Asian Trading Of Bitcoin Tells Lot Regarding Banking Systems
There is a significant traction gained by bitcoin in Korea and Japan. The price of bitcoin reaches to a new height once again and it is showing some friction in the banking systems in Asia that are not shown easily to the outsiders before.
Over the past month, the bitcoin price rises almost 50% on average and it diverges drastically between the markets because the traders are finding it tough to move fiat currencies across the borders.
Bitfinex filed a lawsuit on 5 April 2017 which reveals that the processing of US dollars between Bitfinex’s Taiwanese partner banks has stopped by the American bank Wells Fargo.
Wells Fargo is a private company who can do business freely wherever they want, but it is the sole bank that available for clearance of US dollar for several Taiwanese banks and getting out of the dollar market is not good.
Trading on Bitfinex continues and the users are in a hurry to take away their assets from the exchange. OKCoin is a cryptocurrency exchange that has bank accounts in Taiwan. They are also reporting issues with the clearing and had to limit deposits and withdrawals.
Taiwanese Banking System
With its diverse and competitive banking system, Taiwan has remained an attractive option for the blockchain ventures and fintech startups. It has a greater dependency on a small portion of monopolistic banks in the US for international transfers who can shut down the businesses at their own will.
However, there is a workaround founded by some traders. The users who have access to both Hong Kong bank and Taiwanese forex accounts can withdraw the Taiwan dollars into their Taiwanese bank accounts.
After that, they can convert them to Hong Kong dollars and then send them to Hong Kong from where bitcoins can be bought at a cheaper price. Additionally, they can sell it on the exchanges in Taiwanese at a higher rate and repeat the cycle until the arbitrage chances get faded.