The recent Chinese regulations have made it difficult for Bitcoin services to flourish in China. In December 2013, the price of a Bitcoin fell close to 28% in one single day due to the announcement of a ban from People’s Bank of China (PBOC) on banking services that fund Bitcoin Exchanges in mainland China. This also triggered a month long price volatility in the Bitcoin market and created a sense of danger for long term investors.

Bihang is the new Chinese Bitcoin startup that has been started in the times of such heavy regulation from the Chinese government. The timing of the launch has made people question who would launch a Bitcoin website in such a climate?

Bihang is a Chinese application development company that focuses on developing Android apps for Bitcoin services. One of its famous project is Bibao, an Android mobile application for Bitcoin or Litecoin Exchanges. The application works similar to a stock market application, where in you can constantly see updated exchange rates of Bitcoins, Litecoins and major Chinese currencies. Through the Bibao application, you can check your BTC balance, read news about Bitcoins across the Chinese web, set up and receive alerts about Bitcoin price and track exchange rates of major Chinese currencies against Bitcoin. As an introductory offer, the website doesn’t charge any transaction fees and is a free download application on the Google Play store.

Bihang website was launched by its co-founders Jiang Changhao and Wang Hao. Jiang is a former research scientist at Facebook, while Wang used to work at Goldman Sachs. Before launching the business, Jiang first studied the articles by Satoshi Nakamoto, the man behind the concept of bitcoins, and the visions shared by those who were key to the development of the digital currency.

"If one can carry out peer-to-peer transactions without relying on the support of centralized organizations and third-party payment firms, it would be very cool," Jiang said, citing the property market, and intellectual property rights transfer, as two areas that would benefit from the lack of regulation. "This will be a whole new set of rules for the game, which will turn a lot of traditional trading practices on their head," Jiang added.

If one can carry out peer-to-peer transactions without relying on the support of centralized organizations and third-party payment firms, it would be very cool,

The Bihang team consists of only 10 people who handle most of the technical and administrative work. Due to security threats that new startups and Bitcoin companies in China face, Jiang has chosen to work with a small team.

With his immense technological experience gained at Facebook and his influence in the Chinese technological market, can Jiang turn some heads in the Bitcoin tech community? With China being heavily anti-Bitcoin, it is worth seeing if such startups actually bring in more investors and users to the Bitcoin community and compel the Chinese government to ease the strict regulations on Bitcoin funding by Chinese banks.

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China, the world’s most populous country and the second largest global economy has strict regulations against Bitcoin. China National Bank - The People’s Bank of China, banned third-party payment companies from processing Bitcoin transactions on Dec 16, 2013. This move was harshly revolted by many in the Bitcoin community. But, as a consequence to the ban, the very next day, Bitcoin price drops almost 29%. This created a panic in the Bitcoin community that added to the price drop.

More recently, on April 28, 2014, the Bitcoin price dropped almost 15% on the news of a Chinese Bank deposits being suspended. BTC China - in the top five of the most commonly used Bitcoin exchanges, according to Bitcoinity.org - said over the weekend that it had suspended Yuan deposits from the China Merchant Bank, following guidance the bank had posted on its website.

Why is China so anti Bitcoin?

Well, there are many reasons for this for example Bitcoin can pose a threat to the Chinese economy through a loss of control on the flight of capital out of the country.  China’s economy is second to only the United States’ economy by Purchasing Power Parity (PPP) and Gross Domestic Product (GDP). Furthermore, the economy of China is the fastest growing economy in the world with an average growth rate of 10% in the past 25 years. Now you wonder why Walmart is full of Chinese products. With China on a mission to be the world’s largest economy by the next 20 years, the Chinese government is taking all measures to ensure a steady growth rate. This is allowing China to slowly become a stabilized market economy and the Chinese wouldn’t want to endanger it. Furthermore, the objective of the Chinese monetary policy is to keep the value of the Renminbi, RMB (The official currency of China) stable to contribute to a steady economic growth.

Bitcoin, on the other side is an unregulated financial instrument. It has been recently known for its various price fluctuations. Although the Bitcoin is widely accepted in some countries, it poses a great threat to the Chinese economy as it challenges the capital controls in place that guard the value of RMB. With the ease of purchasing and transferring money internationally, Bitcoin might be a big hit in the technologically savvy Chinese population. However, it poses a risk to the Chinese currency, as the Bitcoin could be more readily accepted as means to circumvent controls over Chinese sending their cash overseas. If this were to happen, then it would hinder the steady growth of the Chinese economy and also reduce the control of China on the global economic environment.

Another main reason that China has banned Bitcoin transactions is that Bitcoin could act as a second currency. What would happen if Bitcoin would act as a second currency that couldn’t be pegged in China? China is known to be an export nation, as it exports its products, mainly electronic parts, all over the world. Even the iPhone is made in China and assembled in California. This is due to the cheap labor found in China. Imagine if there is second currency in China that can be traded globally online, wouldn’t the workers want to work for the Bitcoin? If they do so, wouldn’t the average rate for an hour’s work fluctuate according to the global Bitcoin price? This would mean that sometimes, the workers would get more value in Bitcoin than they would get in the RMB. This would hurt the export sales adversely and would hinder the steady economic growth of China, which is linked directly to the RMB. This way, the individual wealth of an average Chinese person would increase, which could potentially lead to an increased demand and an increase in prices, all over China. An increase in prices would increase the property prices astronomically, and this could potentially lead to a property bubble which could throw China into recession, just as it did to the United States in 2008.

Realizing all this, the People’s Bank of China (PBOC) imposed a ban on all Bitcoin transaction in China. After all, the PBOC could not let the usage of Bitcoin affect China’s competitiveness in the global economic framework.

Why does a Chinese ban adversely affect the Bitcoin price?

China is technologically sound. Realizing this many American tech companies like Google have tried to enter the Chinese market, but could not succeed due to the strict economic and government regulations. China is also the world’s fastest growing economy. Therefore, the Chinese economic environment is best suited for Bitcoin to flourish. However, the strict Chinese regulations have made it difficult for Bitcoin companies to flourish in China. The Bitcoin community eagerly waits for Chinese government to ease the regulations. So, any news in an opposite direction would severely affect the Bitcoin price. What’s adding to the price volatility of Bitcoin is the inability of the PBOC to take a definitive stand on the Bitcoin existence in China. Although there are regulations that stop Bitcoin from prospering, there are some Bitcoin companies functioning in China.

But, if the PBOC could take a definitive stand on the Bitcoin existence in China, the Bitcoin community could adopt accordingly and the Bitcoin price volatility could end. Only time would tell if China would modify its monetary policy and accommodate Bitcoin to collectively let the Bitcoin and RMB stabilize the Chinese economy or if it would completely ban everything that has something to do with Bitcoins.

However, recent reports show that the PBOC would soon issue a statement banning all banks from doing business with Bitcoin exchanges in Mainland China. But, not prominent can be said now about the future of Bitcoin in China as the Bitcoin community is organizing a Global Bitcoin Summit in Beijing, China later this month. This is being seen as a move to educate China about Bitcoin and to increase the Bitcoin users in China.

However, we would have to wait a little longer to know who wins this virtual battle between the Bitcoin community and the People’s Bank of China. Stay tuned to Team Bitcoin to know more about this!

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SSX Startup Stock Exchange takes Bitcoin!

For entrepreneurs all over the world, finding a source of funding is one of the most problematic aspects of their entrepreneurial experience. Finding investors could be as painstaking as coming up with an innovative idea to start a new venture. Before the 90s, entrepreneurs used to get in touch with middlemen and brokers to find individual and institutional investors to invest in their ventures. This led to the birth of angel investing and royalty based financing. Apple Inc is one company born out of such investing. But now, with the advent of the internet, a lot of online funding options have come into existence. With the ease of accessibility, startups are able to reach a wider range of investors all over the world. One such option is Crowdfunding.

 

What is Crowdfunding?

Crowdfunding is a method of raising significant funds from the internet, by aggregating a number amount of money from small contributions from individual online investors. With crowdfunding, entrepreneurs can get investment in small terms from a large number of investors. This ultimately sums up into a large amount. Typically, the entrepreneurs gives either a percentage of the company or royalty on sales and services to the online investor. There are two types of crowdfunding - Project crowdfunding (where small amounts for specific projects are accepted as donations) and Enterprise Crowdfunding (where to raise capital or operating costs, a percentage of the company is sold as investment security). Crowdfunding uses the easy accessibility of individuals like friends, family, venture capitalists and others on social networking sites like Google Plus, Facebook, Twitter and LinkedIn.

 

A lot of websites are available online for crowdfunding purposes. You can easily find a project that you like and fund it by paying with a credit or debit card. The problem here is the lack of authentication and a proper system to see a sale through.

 

What is Startup Stock Exchange?

Startup Stock Exchange (SSX) is a government regulated, global public marketplace for startup investing and funding, with investors from over 100 countries. On SSX, investors of any level buy ownership shares of vetted startup companies. Shares trade freely on the exchange, providing a liquid market. Investors can buy or sell anytime and control their own account.  Startups raise capital on SSX from an international pool of investors. They raise money at a significantly lower cost of capital than current money raising methods.

 

SSX takes the concept of crowdfunding and adds the security, liquidity and control of a securities exchange. SSX provides an online market where investors of any level buy public shares of vetted startup companies, while Startups raise their working capital or operational costs they need from these global investors. Each company’s shares are sold through an Initial Public Offering (IPO) on Startup Stock Exchange and there is no minimum investment for an investor.

 

Startup Stock Exchange for Startup Companies

Startup Stock Exchange helps startup companies raise the needed capital through safe crowdfunding means. Each company is needed to submit its business documentation such as business plan, financial details, executive summary and other corporate documentation. Once this is done, the application process begins and it includes a six step vetting process to approve a company. Once approved, the company is listed on SSX through an Initial Public Offering (IPO). Investors can buy the company’s stocks which would be held by the Custodian of the Exchange in the name of the investor, to allow electronic trading. Regular reporting by the listed company is required to keep the investors informed. SSX is very selective about the companies that it lists. Only 3% of the companies that apply are approved to list. Each company is analyzed carefully and an in-depth analysis is provided to the investor. To know more about how SSX is beneficial for a Startup Company, please visit Startup Stock Exchange.

 

Startup Stock Exchange for Investors

Startup Stock Exchange helps both individual and institutional investors invest in different startup companies via crowdfunding. Each investor should open an account on SSX by a short registration process to verify a client’s identity. Any Investor that successfully completes registration may invest after deposits funds into their account. However, U.S. and Canadian residents are currently restricted from trading prior to SSX finalizing compliance with the regulations of those countries. Once approved, they can start investing in Startup companies. There are no minimum or maximum investment levels.  The minimum investment is one share, and the maximum is subject to the number of shares available for purchase. An investor may invest using the SSX online marketplace through either subscription prior to IPO, and/or by the trading of shares after IPO.

 

Here are some of the benefits for investors using SSX:

  • No Investment Limits
  • Transparency and Oversight
  • Security (Investor Verification, Company Vetting, Due Diligence and Information Security
  • Diverse Companies
  • Regulated Marketplace (Government Regulation and Anti-Money Laundering)
  • Low Investment Fees (No Fees on IPO trades and 1.5% commission on all other trades)
  • Control Your Own Account (Personal Trading Account, Extended Company Advisory)
  • Strict Vetting of Offerings
  • Company Reporting and Communication
  • Investment Liquidity (Active 24x7 Global Marketplace)
  • Easy to Use Interface
  • Electronic Trading as the the company’s stocks are held by the Custodian of the Exchange in the name of the investor

 

About the SSX Team

Ian Haet is the CEO and the founder of SSX and Brian Niessen is the CIO and the co-founder of SSX. Both of them have a vast experience in creating and managing technological companies. SSX has received funding from a lot of individual and institutional investors from all over Europe and the United States, including Greg Kidd, the famous angel investor who owns a major stake in Twitter.

 

SSX Now Accepts Bitcoin

On April 23, 2014, Startup Stock Exchange is now accepting Bitcoin as a mode of payment to buy stocks of companies listed in SSX. SSX becomes the first investment platform to allow investors to buy publicly traded shares of a company. Investors can now fund their SSX Investment Account by Bitcoins, using the GoCoin payment processor. The GoCoin payment processor bypasses the cumbersome and less private / secure  options of virtual exchanges and other third parties and offers Bitcoin owners the ability to pay merchants actual dollars in exchange for a Bitcoin. Therefore, the Bitcoins would be converted into USD before being used for investing in companies listed on SSX.

 

SSX provides investors of all levels access to investment opportunities in global Startups. The addition of Bitcoin as a funding method makes it easier for these investors to participate on our global market and invest in our public Startups,said Ian Haet, CEO and Co-Founder of the Startup Stock Exchange.

 

Why did SSX start accepting Bitcoins?

SSX is a global marketplace which lists companies from all over the world and has clients in over 100 countries. To reach a wider population, SSX had to find a financial instrument which has a low money transfer fee. What better than Bitcoin? Due to the online nature of Bitcoins, it is the most cost effective financial instrument for international transfers, covering countries such as Argentina, Singapore, Venezuela, South Africa and Morocco. Moreover, due to the rising popularity of Bitcoin and due to the tremendous similarities in the SSX mission and the purpose of Bitcoins, SSX started accepting Bitcoins. Moreover, SSX believes in providing a more secure source for crowdfunding and what better way than accepting Bitcoin, knowing the cryptographic security features that it comes with.

 

Bitcoin is unregulated and SSX is government regulated. How does it work?

Although Bitcoins are unregulated financial instruments, all Bitcoin transactions on SSX are reviewed according to strict Anti-Money Laundering (AML/CFT) procedures. As a regulated global marketplace for Startup investing and funding, this review process is an important factor in adhering to global best practices regarding the prevention of Money Laundering and maintaining the security of investing via SSX.

 

The Future

This innovative idea of funding startup companies with Bitcoins, through Startup Stock Exchange is not only beneficial to SSX but also the Bitcoin community. With major companies like SSX accepting the Bitcoin, its popularity increases which creates a demand, thereby increasing the price as the supply of Bitcoin is capped. Furthermore, this idea also invented a new purpose for the use of Bitcoins in the financial world. However, one should be cautious about the investment as the Bitcoin price is highly fluctuating now. This could create an imbalance in investment for investor using Bitcoin as a mode of funding for startups on SSX.

 

On the brighter side, the total reach of SSX is bound to increase. The use of Bitcoin as a mode of funding would attract a lot of investors from the technologically sound countries towards SSX. Moreover, with the increase of the total reach, SSX might also beat the more conventional Stock Exchanges. Scouting for places to spend their Bitcoins, many individuals might actually want to save their Bitcoins by investing in startup companies and you never know you might be funding the next Facebook! 

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Bitcoin ATM by RoboCoin

With the Bitcoin being a massive hit in the financial industry, anything about Bitcoins becomes a news headline. Investors are flocking to Bitcoin markets as they see them as the future. To add to this huge Bitcoin’s crazy success, come the Bitcoin ATMs. Yes, you heard it right! Bitcoin Automatic Teller Machines are now in existence. What once seemed the future, is now a reality with the technological advancements.

 

So, how does a Bitcoin ATM work?

 In a regular cash-based ATM, you put in your debit card, which is essentially a form identification authorizing bank transactions along with a private pin number usually 4 or 6 digits. Where this legacy model fails is that knowledge of you debit card number is sometimes all that is required to make a transaction. Your card number is shared publicly every time you swipe it in public there is an opportunity for theft. In this way your credit card number is the equivalent of your Bitcoin private key! We all know that if you share your Bitcoin private key, your Bitcoins will be stolen. This is why debit/credit cards are always under attack, the private keys are always shared everywhere and checks and balances for unauthorized use of those keys(credit card numbers) are weak and inconsistent.

 

The ATM is just like a computer that reads your card information and transmits it to a central processor, which then processes your transaction and sends it to the bank associated with your debit card. With a Bitcoin ATM, the process is similar, but instead of a debit card, you scan your phone against the ATM scanner, which reads your account information through a Quick Response (QR) code. Your Bitcoin address is stored in the QR code, which is usually available through your standard Bitcoin wallet. The ATM then knows which account you are using to send or receive money.

 

So, the next time your son in Australia calls you in the middle of a shopping day and ask you for college money, just go to the nearest ATM and transfer money across the globe within seconds! All this with a simple scanning of a QR code.

 

What is Robocoin?

Robocoin is Bitcoin’s first ATM. Introduced to ease the process of sending money across the globe, Robocoin makes it easy for customers to buy and sell without dealing with the cumbersome online identity verification requirements. With Robocoin, you can avoid the hassle of filling out a long international transfer form and then verifying your identity to send money internationally. Within seconds you can transfer or receive money around the world, in the currency you prefer! Now, let’s see how the Robocoin functions for different kinds of users.

 

Robocoin for customers

Robocoin ATM can be used to send and receive money, all over the world. However, one requires a digital wallet (which acts as a bank account number) to use the Bitcoin ATM. From your digital wallet, send Bitcoin to the Robocoin wallet and wait for a confirmation email. Once, you get the confirmation email, it takes 10 minutes for the transaction to process and the Bitcoins to be sent to Robocoin. The email would contain a ticket for the transaction. The ticket is a QR code which needs to be scanned. Once this is done, go to the nearest Robocoin ATM and scan your ticket to receive money in whichever currency you prefer. The following is a screenshot from a Bitcoin transaction through Robocoin (Source: robocoinkiosk.com): 

robocoin

To be Anti Money Laundering compliant, every Robocoin ATM comes with a 3 step simple verification which is easy, fast and unobtrusive. All you need is your palm, a Government issued ID and a picture of your face taken. As a part of the verification process, your palm and Government issued ID is scanned and a picture of your face is taken. This creates a profile for each customer which can be verified for further transactions. This profile is verified to avoid any fraudulent and unusual activity. 

 

According to the Robocoin blog, Robocoin opened for business at 900 Howe St., Vancouver, Canada and exceeds $1,000,000 CAD transaction volume in less than one month! This just shows how popular Robocoin has become, almost instantaneously. Robocoin ATMs have now expanded globally, spanning to even the farthest countries such as Japan and Australia.

Robocoin for operators

Robocoin claims to have been built from ground up to be globally complaint. You can buy a Robocoin ATM and run it in any of the local stores. A Robocoin ATM is known to attract a lot of traffic, therefore the landlord might even pay you to have the ATM setup in his store. As a Robocoin operator, one has to adhere to the country’s and state’s Anti Money Laundering regulations and customer compliance. As an introductory offer, Robocoin offers the operator an unrivalled 0% fee on purchasing a Robocoin license and a minimal cost for purchasing the Robocoin ATM.

 

As a part of Robocoin’s 3 step verification process, each customer profile is checked with the Office of Foreign Asset Control for any unusual or fraudulent activity and operators are immediately notified via a text message and an email. Robocoin also encourages operators to use safe cash logistic companies to ensure there is regular cash inflow in the ATM.

 

The more the Robocoin operators, the more the Bitcoin value will increase. The demand for Bitcoin will increase by increasing the traffic and this is brilliant way to increase any store traffic. So, the next time you want start an entrepreneurial venture, become a Robocoin operator.

 

Robocoin for Ambassadors

With the Robocoin Ambassador Program, the Robocoin website offers you the opportunity to market Robocoin ATM and receive a competitive price for it. For every Robocoin ATM sold, you receive $10,000! Isn’t it an easy way to earn money while contributing to the expansion of the Bitcoin community? The Robocoin website offers you a simple form to fill out to become a Robocoin Ambassador and start earning!

 

Therefore, Robocoin not only offers a mildly regulated method to send or receive Bitcoins, but also contributes heavily to the expansion of the Bitcoin community itself. Could this be the critical technology to expand Bitcoins reach into the main stream? Could we soon see Robocoin ATMs span all over the world? Only time would give answers to these questions. But, for now Robocoin is creating waves all over the world and has recently opened a new Robocoin ATM in Japan! 

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AuthorTeam Bitcoin