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China The Almighty Buck

OKCoin Raises $10 Million To Become China's Largest Bitcoin Exchange 48

Posted by samzenpus
from the what-could-go-wrong? dept.
edibobb writes "Despite recent cryptocurrency crackdowns by the Chinese government, OKCoin announced a round of $10 million funding by three prominent venture capital firms and other investors. OKCoin is supposed to be the largest bitcoin exchange in China. From the article: 'Back in November 2013, the focus of the bitcoin community was on China – the world’s hub for bitcoin trading. At that time, BTC China was the biggest exchange in the world, having managed to raise a $5m Series A funding round from Lightspeed Venture Partners (Snapchat, Nest). There were even rumours that a bigger round was in the works for the young company. However, things change quickly. After the Chinese government began regulating bitcoin in December, trade volume plummeted and the world’s top exchange was no longer Chinese.'"
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OKCoin Raises $10 Million To Become China's Largest Bitcoin Exchange

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  • much wow
  • Ok, probably a stupid question here !

    What is the point of an exchange in the bitcoin world ?
    • by Cruciform (42896)

      A fraction of every transaction goes to the exchange, which can add up to significant profit.

      • It would be interesting, if somehow the exchange functionality were built into the protocol and entirely P2P. Getting rid of these centralized exchanges seems like it would really stabilize the currency. I don't know how remotely feasible that would be, it is far too early in the morning without coffee.
        • It would be interesting, if somehow the exchange functionality were built into the protocol and entirely P2P. Getting rid of these centralized exchanges seems like it would really stabilize the currency. I don't know how remotely feasible that would be, it is far too early in the morning without coffee.

          Effectively, what you describe is the protocol(which is p2p as well), except that the protocol does not address the issue of matching prospective buyers and prospective sellers (a protocol that does this, without a central market-operator, would be neat; but bodging one into a protocol for transferring virtual coins without double-spending would probably be unwieldy, though clients that implement both would be logical).

          Perhaps the more fundamental issue (aside from any empirically hairy and/or provably i

          • by Cigarra (652458)

            It would be interesting, if somehow the exchange functionality were built into the protocol and entirely P2P. Getting rid of these centralized exchanges seems like it would really stabilize the currency. I don't know how remotely feasible that would be, it is far too early in the morning without coffee.

            Effectively, what you describe is the protocol(which is p2p as well), except that the protocol does not address the issue of matching prospective buyers and prospective sellers (a protocol that does this, without a central market-operator, would be neat; but bodging one into a protocol for transferring virtual coins without double-spending would probably be unwieldy, though clients that implement both would be logical).

            Uhm... isn't Ripple [ripple.com] supposed to be that decentralized exchange?

          • You can have both. Let's take transaction time performance for example -- bitcoin does not provide fast resolution (compared to, say, the visa network) but nothing is keeping a transaction broker from laying on top and providing those services. A 'bitcoin visa' payment service would then provide near instant times, allow for chargebacks, etc by absorbing the risk through fees and making a profit on the difference.
            • by lgw (121541)

              Well put. I'll keep repeating that bitcoin won't ever go mainstream without bitcoin-denominated credit cards and savings accounts. But of course, once you have those the money supply balloons, and that can be exploited by central banks, and really it stops being particularly different from what we already have.

            • I should have phrased that a bit more clearly: it's perfectly possible for different people(or even the same people, with different bitcoins) to have 'eh, you'll just have to trust us on that; but it sure is fast!' and mathemagic-crypto-money at the same time, it's not as though the presence of one activity irrevocably taints the entire pool of bitcoins for the other; but any specific bitcoin (or subdivision of one) can only have one or the other:

              Someone always has to be the one holding the private keys,
        • by TheCarp (96830)

          I thought about this for a second a while back but, it slams up against one really major...no...fundamental problem.

          The exchange is a point where currencies/commodities/etc meet. No amount of messing with the details behind how you move money around in your accounts can actually cause food to move to your table or hand you dollar bills. At some point the rubber has to meet the road or else you are just spinning wheels.

          The bitcoin protocol, or any such protocol can only deal with itself. In order to exchange

      • A fraction of every transaction goes to the exchange, which can add up to significant profit.

        And in the case of some exchanges the entire transaction goes to the exchange, which adds up to a even more significant profit.

    • by NuAngel (732572)
      Exchanges are used to "exchange" from virtual currency to a different regional currency (cash out your BTC for some USD).
    • by Sockatume (732728) on Monday March 17, 2014 @10:04AM (#46505397)

      1) If you want to use bitcoins, you have to buy some bitcoins. Originally you'd buy them either from a miner who was producing coins, or from someone else further down the food chain. That person takes your cash and transfers some coins into your crytographic wallet.

      2) If you want to make or receive a payment with bitcoins - transfer them to someone else, in other words - you simply send a transaction out onto the bitcoin network, transferring the money between the wallets as approved by both parties.

      Both of these processes are slowed down by the fact that the bitcoin network takes time to verify a transaction, passing the transaction around until it has been cryptographically set in stone. It's more convenient to have a completely ordinary bank, that pays in and out and transfers money between its customers' accounts rapidly, then balances its books with non-customers and other banks on the bitcoin network on its own time. That is a bitcoin exchange.

    • by Anonymous Coward

      What is the point of an exchange in the bitcoin world ?

      It's a mechanism by which people with bitcoins will give them to you so you can run off with them later.

    • by TWX (665546)

      Ok, probably a stupid question here ! What is the point of an exchange in the bitcoin world ?

      Apparently it's to allow a third-party access to your private key, so that they can steal all of your bitcoins.

      • by tompaulco (629533)

        Apparently it's to allow a third-party access to your private key, so that they can steal all of your bitcoins.

        I think you mean public key and can't steal all of your bitcoins.

    • by Joce640k (829181)

      What is the point of an exchange in the bitcoin world ?

      Somebody has to have large reserves of real money for when people want to sell their bitcoins.

    • Ok, probably a stupid question here ! What is the point of an exchange in the bitcoin world ?

      It's just a bank that accepts bitcoin. Bitcoin banks (aka exchanges) are still unregulated and underinsured except in China. Since most banks won't take bitcoin, you can't trade bitcoins for other currencies at those banks either. An exchange is necessary to do much with bitcoin since there are precious few places to spend a bitcoin directly now that silk road is defunct.

    • by edibobb (113989)
      An exchange is a place to buy and sell bitcoins. Using an one as a bank is not so safe, but people do that too.
    • An exchange is a place where buyers and sellers can meet to do business and where the price of goods is determined. You place an order with the exchange and it tries to fulfill your order given the other orders in the system. Some exchanges allow you to trade on margin, where you're only required to post a portion of the money for your deals and the exchange covers the rest. Exchanges make their money by charging a small fee per transaction.

      Say you want to buy 100 Bitcoins, you open an account with an

  • I know I will get moded down into oblivion, but whatever. Anyways we all know this exchange will rise and “collapse” running off with a lot of money just like the others. I think the supporters of Bitcoin are probably those who profit from this whole scheme.
    • by TWX (665546)

      I know I will get moded down into oblivion, but whatever. Anyways we all know this exchange will rise and “collapse” running off with a lot of money just like the others. I think the supporters of Bitcoin are probably those who profit from this whole scheme.

      No, I think we're seeing an honest, untainted demonstration of true Laissez-faire capitalism at work.

      It shows you that what's yours, aka what your wealth is, truly is only what you can lay your hands on right now if there's nothing to sup

      • by QilessQi (2044624)

        +1 Insightful. It also doesn't matter who can look at the blockchain to see that X has stolen Y's coins if no one can force a reversal of that transaction.

        In American terms, regulation rests on three pillars: Legislative, to define the laws; Judicial, to determine when those laws have been violated; and Executive, to enforce the laws and to redress violations by taking corrective or punative action. Without those pillars you don't really have free-market capitalism: you have anarchy.

      • It shows you that what's yours, aka what your wealth is, truly is only what you can lay your hands on right now if there's nothing to support your claims to wealth. At this exact moment in time that's a laptop computer and an open, half-consumed can of Mountain Dew, and a physical wallet with a few dollars in it.

        It's regulation that says that I own cars, a home, the contents of that home, and the contents of my bank accounts. If someone tries to take any of those things then I either get them back or I ge

  • To me this sounds like some guys thinking "Hey - that Mt. Gox Guy set up an exchange and almost got away with bajillions. I bet we can do the same thing without his mistakes..."

    Or - they are dumb enough to want to become a Big Fish in a Small Pond with Poisoned Waters.

    (I'm sure there's some Poison/Poisson joke in there somewhere)

  • They first named it "AbsolutelyFantasticCoin", but then they found that it was mostly just OK, so in name of honesty they renamed it humbly to "OKCoin".
  • Hey, I have an invention and it was already found to be illegal in my country. Want to invest in that too? It's a sure-win!
  • Ok. I've been in China for *ages*, and I can't tell you how frequently people skate from businesses and literally disappear. Here are some personal examples: * Bought membership at a really nice gym. Stored some gym stuff in locker there. Thought it strange that they suddenly had a HUGE discount to get new members - thought it was no big deal since it wasn't really busy. Arrived one morning shortly after to see staff outside, locked out. Overnight, literally out the back door, owner sold off some assets an

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