Businesses
dealing with the virtual currency bitcoin have sprouted across China, the most
popular being the currency's trading platforms. Some have secured major
investments, according to the Beijing-based Economic Observer.
China now
has close to 10 bitcoin trading platforms, the more influential of which are
BTC China, BTC Trade, Huobi and OKcoin.
BTC China
secured a loan in the middle of this year for US$5 million from Lightspeed
Venture Partners; OKcoin has secured funds from angel investors including Mai
Gang, founder of Ventures Lab; and Huobi in November secured an investment from
an unspecified investor in the internet business.
Li Lin,
founder of Huobi, said his trading platform now has more than 200,000
registered users trading bitcoins through the site. His company will specialise
in such transactions for the time being, which will remain free of charge, Li
said.
His company
is planning to launch a membership system and will look to create other sources
of revenues by charging for services other than basic transactions, such as
expedited processing.
OKcoin, on
the other hand, is considering other business models beyond basic transactions,
such as a payment system using bitcoins. Payment using bitcoins is not allowed
under the current regulations in China.
In
response, Xu Mingxing, founder of OKcoin, pointed out that his company is
considering experimenting with the plan through a company registered overseas.
Xu said his
company is also considering an electronic wallet for bitcoins, banks that
handle bitcoin deposits and going public on bitcoin exchanges.
In China,
bitcoin-related businesses are spreading like a virus as Chinese businesspeople
seek to profit from speculation in the digital currency, according to Ron Cao,
managing director of Lightspeed Venture Partners.
However, in
the United States, where the bitcoin's popularity is lower among the general
public than in China, there is greater variety in the types of businesses being
created around bitcoins, Cao said.
For
instance, US-based Coinbase — which offers a trading platform for bitcoins and
an electronic wallet service — recently secured investments from companies
including US research and venture capital organization International Data Group
in the middle of the year.
Another US
company, bitcoin payment processor BitPay, has announced receiving an
unspecified investment following receipt of an earlier US$2 million sum in the
middle of the year.
Hong
Kong-based investment and venture capital firm Horizons Ventures, owned by Hong
Kong business magnate Li Ka-shing, has reportedly also made an investment in
BitPay.
Payment
using bitcoins has become relatively more mature in the United States, with
BitPay and Coinbase now boasting 100,000 commercial users, according to Cao.
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