zhangweiwu



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Sr. MemberActivity: 313Merit: 250 false signal resulted rally in China, and it won't stop. October 21, 2013, 05:29:00 AM

Last edit: October 21, 2013, 07:45:16 AM by zhangweiwu #1



For example this report of sina.com (one of the biggest Chinese online news outlet):

http://tech.sina.com.cn/i/2013-10-17/10248825635.shtml



These reports suggests that the adoption by Baidu is a signal that the big vendors are accepting bitccoin - consider the close tie between baidu and central government, that the government may be interested too. It is like saying Microsoft or Facebook started to accept bitcoin. That tapped on the emotion and BTC rose.



I think the big vendors are no way closer to accepting bitcoin in the last week than any weeks before. It is indeed a small change, and signals nothing from big vendors nor the central government at all.



Chinese information technology vendors, including the big ones, in general prefer the studio model. A big company is devided into multiple studios, some companys have 100 studios. They each compete against each other. They compete on revenue and profit, within the embralla of a same company. Each studio find their own ways of making profit, and enjoy freedom of decision as long as they are making money. The mother company acts like a referee, dismissing unprofitable studios and buying out (admitting) small competitors to form new studios; the mother company also act as a protector, backing the studios with tremendous PR and governmental relationship power in case their competitor choose to fight on a different level (which also happens). This fast-proliferating fast-evoluting style isn't very co-ordinated, but it is effective because in general in China our culture emphasize competition, and we like to compete and win and we work the best if competition is physically next door. If instead big vendors are organized like Microsoft to co-operate and create huge products (Windows 7) in 5-year span, the youngsters wouldn't stay on their edge - they need quick confirmation whether they are wining or not - they work very hard but doesn't have much patience. Skipping between studios is frequent, the fast-growing studios get more resource and people.



The recent acceptance of bitcoin is likely a decision of a single stuidio in the embralla of baidu, perhaps trying to beat other studios of the same company. Baidu HQs speaksman said nothing about bitcoin in the whole year. How Baidu HQs treats the move is unkown, and they probably don't have an attitude, for it (bitcoin) is trivial compare to the huge online information market they are already on. News interview suggests this is a decision of an individual studio: "We always try to satisfy the webmasters, so when they want to pay with bitcoin, we accept them". Notice the interviewee said 'webmasters', that's the customers of this studio, not Baidu in whole, and he speaks for his own studio.



Also take notice the customer of this studio (jiasule.baidu.com), the webmasters, happen to be the major group of bitcoin miners in China.



So why such a small piece of news that indicates nothing for sure, stirs up such a rally? More important than the news itself it says Chinese investors are desperately looking for a reason to rally. They perhaps expected bitcoin to be above 1000¥ for a long time, now they only need a slight upward vibrate to rally. And they have a good reason to hope for a rally, for they bought huge amount of mining equipments in anticipation of raise of bitcoin value.



My reading of the event is, that Chinese investors are anticipating a rally for a long time, thus it won't cool down in just a few days. However they are speculating, not having much faith in sustanibility of bitcoin and may be frighten away by small bad news within China. They are less sensitive to western news like silkroad.



In China we have highly centralized political power. The chance Chinese government allows bitcoin on the markets (when it calls their attention) is like the chance U.S. government raise debt in BTC. The big vendors foresee it and shouldn't be interested. Besides we have a monoplay business atomosphere in China (every player are greedy, wants to win and take all), and you don't monoplay bitcoin. I see no reason Baidu being interested to include bitcoin into their development strategy. Small vendors are much more likely to be interested in btc.



(OP is a Chinese citizen in Beijing)



If you search the topic in baidu of the last week's price rise, and you search in Chinese, most posts and reports ascribe it to the recent adoption of bitcoin payment method by a web service of Baidu (jiasule.baidu.com).For example this report of sina.com (one of the biggest Chinese online news outlet):These reports suggests that the adoption by Baidu is a signal that the big vendors are accepting bitccoin - consider the close tie between baidu and central government, that the government may be interested too. It is like saying Microsoft or Facebook started to accept bitcoin. That tapped on the emotion and BTC rose.I think the big vendors are no way closer to accepting bitcoin in the last week than any weeks before. It is indeed a small change, and signals nothing from big vendors nor the central government at all.Chinese information technology vendors, including the big ones, in general prefer the studio model. A big company is devided into multiple studios, some companys have 100 studios. They each compete against each other. They compete on revenue and profit, within the embralla of a same company. Each studio find their own ways of making profit, and enjoy freedom of decision as long as they are making money. The mother company acts like a referee, dismissing unprofitable studios and buying out (admitting) small competitors to form new studios; the mother company also act as a protector, backing the studios with tremendous PR and governmental relationship power in case their competitor choose to fight on a different level (which also happens). This fast-proliferating fast-evoluting style isn't very co-ordinated, but it is effective because in general in China our culture emphasize competition, and we like to compete and win and we work the best if competition is physically next door. If instead big vendors are organized like Microsoft to co-operate and create huge products (Windows 7) in 5-year span, the youngsters wouldn't stay on their edge - they need quick confirmation whether they are wining or not - they work very hard but doesn't have much patience. Skipping between studios is frequent, the fast-growing studios get more resource and people.The recent acceptance of bitcoin is likely a decision of a single stuidio in the embralla of baidu, perhaps trying to beat other studios of the same company. Baidu HQs speaksman said nothing about bitcoin in the whole year. How Baidu HQs treats the move is unkown, and they probably don't have an attitude, for it (bitcoin) is trivial compare to the huge online information market they are already on. News interview suggests this is a decision of an individual studio: "We always try to satisfy the webmasters, so when they want to pay with bitcoin, we accept them". Notice the interviewee said 'webmasters', that's the customers of this studio, not Baidu in whole, and he speaks for his own studio.Also take notice the customer of this studio (jiasule.baidu.com), the webmasters, happen to be the major group of bitcoin miners in China.So why such a small piece of news that indicates nothing for sure, stirs up such a rally? More important than the news itself it says Chinese investors are desperately looking for a reason to rally. They perhaps expected bitcoin to be above 1000¥ for a long time, now they only need a slight upward vibrate to rally. And they have a good reason to hope for a rally, for they bought huge amount of mining equipments in anticipation of raise of bitcoin value.My reading of the event is, that Chinese investors are anticipating a rally for a long time, thus it won't cool down in just a few days. However they are speculating, not having much faith in sustanibility of bitcoin and may be frighten away by small bad news within China. They are less sensitive to western news like silkroad.In China we have highly centralized political power. The chance Chinese government allows bitcoin on the markets (when it calls their attention) is like the chance U.S. government raise debt in BTC. The big vendors foresee it and shouldn't be interested. Besides we have a monoplay business atomosphere in China (every player are greedy, wants to win and take all), and you don't monoplay bitcoin. I see no reason Baidu being interested to include bitcoin into their development strategy. Small vendors are much more likely to be interested in btc.(OP is a Chinese citizen in Beijing) My (old) column about Bitcoin & China: http://bitcoinblog.de/tag/zhangweiwuengl/

Zangelbert Bingledack



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LegendaryActivity: 1036Merit: 1000 Re: recent rally in China is because of market emtion, not because of baidu October 21, 2013, 05:44:25 AM

Last edit: October 21, 2013, 06:01:55 AM by Zangelbert Bingledack #3 It does look sort of like China was looking for an excuse to rally, but that's how these things go: bubbles attract attention, which attracts many strong hands and many more weak hands...some of whom become strong hands as their position prompts educational interest. In the end the price level is much higher, even after the "burst" (see 2011 and early 2013).



In other words, it looks like sentiment drove Baidu Jiasule to accept bitcoins, rather than their acceptance driving sentiment. The Baidu story isn't what caused China to catch the Bitcoin bug; it's proof that China has caught the Bitcoin bug.

windjc



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LegendaryActivity: 2044Merit: 1061 Re: recent rally in China is because of market emtion, not because of baidu October 21, 2013, 05:46:58 AM #4 Quote from: zhangweiwu on October 21, 2013, 05:29:00 AM



For example this report of sina.com (one of the biggest Chinese online news outlet):

http://tech.sina.com.cn/i/2013-10-17/10248825635.shtml



These reports suggests that the adoption by Baidu is a signal that the big vendors are accepting bitccoin. It is like saying Microsoft or Facebook started to accept bitcoin. That tapped on the emiontion and BTC rose.



I think the big vendors are no way closer to accepting bitcoin in the last week than any weeks before. It is indeed a small change, and signals nothing from big vendors at all.



Chinese vendors, even the big onces, in general prefer the studio model. A big company is devided into multiple studios, some companys have 100 studios. They each compete against each other. They compete on revenue and profit, within the embralla of a same company. Each studio find their own ways of making profit, and enjoy freedom of decision as long as they are making money. The company acts like a market, turns off unprofitable studios and open new ones. This isn't very co-ordinated, but it is effective because in general in China our culture emphasize competition, and we like to compete and win. If instead big vendors are organized like Microsoft to co-operate and create huge products (Windows 7) in 5-year span, the youngsters wouldn't stay on their edge - they need quick confirmation whether they are wining or not - they work very hard but doesn't have much patience.



The recent acceptance of bitcoin is likely a decision of a single stuidio in the embralla of baidu. How Baidu HQs treats the move is unkown, and they probably don't have an attitude, for it (bitcoin) is trivial compare to the huge online information market they are already on. News interview suggests this is a decision of an individual studio: "We always try to satisfy the webmasters, so when they want to pay with bitcoin, we accept them". Notice the interviewee said 'webmasters', that's the customers of this studio, not Baidu in whole, and he speaks for his own studio.



Also take notice the customer of this studio (jiasule.baidu.com), the webmasters, happen to be the major group of bitcoin miners in China.



So why such a small piece of news that indicates nothing for sure, calls up such a rally? More important than the news itself it says Chinese investors are desperately looking for a reason to rally. They perhaps expected bitcoin to be above 1000¥ for a long time, now they only need a slight upward vibrate to rally. And they have a good reason to hope for a rally, for they bought huge amount of mining equipments in anticipation of raise of bitcoin value.



My reading of the event is, that Chinese investors are anticipating a rally for a long time, thus it won't cool down in just a few days. However they are speculating, not having much faith in sustanibility of bitcoin and may be frighten away by small bad news within China. They are less sensitive to western news like silkroad.



In China we have highly centralized political power. The chance Chinese government allows bitcoin on the markets (when it calls their attention) is like the chance U.S. government raise debt in BTC. The big vendors foresee it and shouldn't be interested. Besides we have a monoplay business atomosphere in China (every player are greedy, wants to win and take all), and you don't monoplay bitcoin. I see no reason Baidu being interested to include bitcoin into their development strategy. Small vendors are much more likely to be interested in btc.



(OP is a Chinese citizen in Beijing)



Interesting. Thanks for the insight. One question: when you say there is no way the Chinese gov would allow bitcoin on the markets, what exactly are referring to?







If you search the topic in baidu of the last week's price rise, and you search in Chinese, most posts and reports seem to attribute it to the recent adoption of bitcoin payment method by a web service of Baidu (jiasule.baidu.com).For example this report of sina.com (one of the biggest Chinese online news outlet):These reports suggests that the adoption by Baidu is a signal that the big vendors are accepting bitccoin. It is like saying Microsoft or Facebook started to accept bitcoin. That tapped on the emiontion and BTC rose.I think the big vendors are no way closer to accepting bitcoin in the last week than any weeks before. It is indeed a small change, and signals nothing from big vendors at all.Chinese vendors, even the big onces, in general prefer the studio model. A big company is devided into multiple studios, some companys have 100 studios. They each compete against each other. They compete on revenue and profit, within the embralla of a same company. Each studio find their own ways of making profit, and enjoy freedom of decision as long as they are making money. The company acts like a market, turns off unprofitable studios and open new ones. This isn't very co-ordinated, but it is effective because in general in China our culture emphasize competition, and we like to compete and win. If instead big vendors are organized like Microsoft to co-operate and create huge products (Windows 7) in 5-year span, the youngsters wouldn't stay on their edge - they need quick confirmation whether they are wining or not - they work very hard but doesn't have much patience.The recent acceptance of bitcoin is likely a decision of a single stuidio in the embralla of baidu. How Baidu HQs treats the move is unkown, and they probably don't have an attitude, for it (bitcoin) is trivial compare to the huge online information market they are already on. News interview suggests this is a decision of an individual studio: "We always try to satisfy the webmasters, so when they want to pay with bitcoin, we accept them". Notice the interviewee said 'webmasters', that's the customers of this studio, not Baidu in whole, and he speaks for his own studio.Also take notice the customer of this studio (jiasule.baidu.com), the webmasters, happen to be the major group of bitcoin miners in China.So why such a small piece of news that indicates nothing for sure, calls up such a rally? More important than the news itself it says Chinese investors are desperately looking for a reason to rally. They perhaps expected bitcoin to be above 1000¥ for a long time, now they only need a slight upward vibrate to rally. And they have a good reason to hope for a rally, for they bought huge amount of mining equipments in anticipation of raise of bitcoin value.My reading of the event is, that Chinese investors are anticipating a rally for a long time, thus it won't cool down in just a few days. However they are speculating, not having much faith in sustanibility of bitcoin and may be frighten away by small bad news within China. They are less sensitive to western news like silkroad.In China we have highly centralized political power. The chance Chinese government allows bitcoin on the markets (when it calls their attention) is like the chance U.S. government raise debt in BTC. The big vendors foresee it and shouldn't be interested. Besides we have a monoplay business atomosphere in China (every player are greedy, wants to win and take all), and you don't monoplay bitcoin. I see no reason Baidu being interested to include bitcoin into their development strategy. Small vendors are much more likely to be interested in btc.(OP is a Chinese citizen in Beijing)Interesting. Thanks for the insight. One question: when you say there is no way the Chinese gov would allow bitcoin on the markets, what exactly are referring to?

zhangweiwu



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Sr. MemberActivity: 313Merit: 250 Re: recent rally in China is because of market emtion, not because of baidu October 21, 2013, 06:01:14 AM

Last edit: October 21, 2013, 07:52:15 AM by zhangweiwu #5 Quote from: windjc on October 21, 2013, 05:46:58 AM One question: when you say there is no way the Chinese gov would allow bitcoin on the markets, what exactly are referring to?



If Chinese government pays attention to bitcoin, it would act the same way they do towards shadow banking: fine those involved in bitcoin yet backed by government, and prosecute the entities without gvernment backing (even execute a few, like the unlucky millionaire Wu Ying last year and Zeng Chengjie this year). The charge will be as usual: illegal fund-raising.



Right now there are two points that needs to be considered on understaind Chinese behaviour:



1. Chinese traders speculate. Few believed in a non-governmental currency taking root, as few believed anything significant yet non-governmental can take root. This translate to a huge bear market when Chinese government acts.



2. The atomsphere in China is like the roaring twenties which I read from books. Everyone feels like they are ready to make a big fortune. This can translates to potential huge bulls.



My two cents.



I feel it is still years away until Chinese government taking action on bitcoin. A centralized power does only a handful of things at a time, and their hands are full in Xi's first 2 year's reign. (Xi is a surname, not roman number 11) If Chinese government pays attention to bitcoin, it would act the same way they do towards shadow banking: fine those involved in bitcoin yet backed by government, and prosecute the entities without gvernment backing (even execute a few, like the unlucky millionaire Wu Ying last year and Zeng Chengjie this year). The charge will be as usual: illegal fund-raising.Right now there are two points that needs to be considered on understaind Chinese behaviour:1. Chinese traders speculate. Few believed in a non-governmental currency taking root, as few believed anything significant yet non-governmental can take root. This translate to a huge bear market when Chinese government acts.2. The atomsphere in China is like the roaring twenties which I read from books. Everyone feels like they are ready to make a big fortune. This can translates to potential huge bulls.My two cents.I feel it is still years away until Chinese government taking action on bitcoin. A centralized power does only a handful of things at a time, and their hands are full in Xi's first 2 year's reign. (Xi is a surname, not roman number 11) My (old) column about Bitcoin & China: http://bitcoinblog.de/tag/zhangweiwuengl/

windjc



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LegendaryActivity: 2044Merit: 1061 Re: recent rally in China is because of market emtion, not because of baidu October 21, 2013, 06:13:44 AM #7 Quote from: zhangweiwu on October 21, 2013, 06:01:14 AM Quote from: windjc on October 21, 2013, 05:46:58 AM One question: when you say there is no way the Chinese gov would allow bitcoin on the markets, what exactly are referring to?



If Chinese government pays attention to bitcoin, it would act the same way they do towards shadow banking: fine those involved in bitcoin yet backed by government, and prosecute the entities without gvernment backing (even execute a few, like Wu Ying last year and Zeng Chengjie this year). The charge will be as usual: illegal fund-raising.



Right now there are two 'concepts'.



1. Chinese traders speculate. Few believed in a non-governmental currency taking root, as few believed anything significant yet non-governmental can take root. This translate to a huge bear market when Chinese government acts.



2. The atomsphere in China is like the roaring twenties which I read from books. Everyone feels like they are ready to make a big fortune. This can translates to potential huge bull markets.



My two cents.



I feel it is still years away until Chinese government taking action on bitcoin. A centralized power does only a handful of things at a time, and their hands are full in Xi's first 2 year's reign.

If Chinese government pays attention to bitcoin, it would act the same way they do towards shadow banking: fine those involved in bitcoin yet backed by government, and prosecute the entities without gvernment backing (even execute a few, like Wu Ying last year and Zeng Chengjie this year). The charge will be as usual: illegal fund-raising.Right now there are two 'concepts'.1. Chinese traders speculate. Few believed in a non-governmental currency taking root, as few believed anything significant yet non-governmental can take root. This translate to a huge bear market when Chinese government acts.2. The atomsphere in China is like the roaring twenties which I read from books. Everyone feels like they are ready to make a big fortune. This can translates to potential huge bull markets.My two cents.I feel it is still years away until Chinese government taking action on bitcoin. A centralized power does only a handful of things at a time, and their hands are full in Xi's first 2 year's reign.

Makes sense. But from my view here in the West, China is very eager to appear mainstream especially when it comes to finance and capitalism. Therefore, if Bitcoin were to get mainstream acceptance in Europe and the US, I could see a world where China didn't try to ban bitcoin. Bitcoin isn't going to threaten a communist Chinese government at anytime in the future anyway. Makes sense. But from my view here in the West, China is very eager to appear mainstream especially when it comes to finance and capitalism. Therefore, if Bitcoin were to get mainstream acceptance in Europe and the US, I could see a world where China didn't try to ban bitcoin. Bitcoin isn't going to threaten a communist Chinese government at anytime in the future anyway.

Elwar



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LegendaryActivity: 3192Merit: 1730Viva Ut Vivas Re: recent rally in China is because of market emtion, not because of baidu October 21, 2013, 06:19:52 AM #9 It seems like Chinese citizens are desperate to get their money into some sort of investment. When the government allowed people to invest in a second home it became such a huge craze of investment that they now have empty cities of "second homes" built purely for investment.



Whether it is Baidu or anything that gets the word to Chinese people with money to invest, if Bitcoin becomes even a sliver of the craze of other investments it will skyrocket the price.





But yes, it will be a bubble. They are in a housing bubble right now and if the US defaults on its loans, China will be hit. So a huge Chinese investment in Bitcoin will not be a solid foundation. First seastead company actually selling sea homes: Ocean Builders https://ocean.builders Of course we accept bitcoin.

Severian



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Sr. MemberActivity: 476Merit: 250 Re: recent rally in China is because of market emtion, not because of baidu October 21, 2013, 06:36:55 AM #10 Quote from: zhangweiwu on October 21, 2013, 06:17:13 AM However if bitcoin present challange to authority (not to actual fiscal power, but to the image of authority, like that "Chinese government can maintain the stability of our own currency"), they treat it differently.



Just speaking as an American observer, one thing that pre-disposes some Chinese citizens to Bitcoin is that millions were already involved in Q Coin, so the idea of digital cash isn't as foreign to them as it is to many Americans. P2P networks in all forms are also familiar territory to a lot of net users in China so the idea of P2P money probably has a little wider acceptance than it would here in the US. In comparison to the rest of the world, most Americans are stodgy and conservative in matters relating to currency. Overall, Bitcoin will probably do better in China than it has here in the US.



A practical matter would also be that if the Chinese government sees Bitcoin as a threat to Western banking (Western banks have admitted as much), then Bitcoin could be seen as a tool to increase their influence if it can undermine the European Central Bank's and the Federal Reserve's influence. But I do agree with you that if your government (or mine) felt more threatened by Bitcoin, they probably would come down on it hard. Just speaking as an American observer, one thing that pre-disposes some Chinese citizens to Bitcoin is that millions were already involved in Q Coin, so the idea of digital cash isn't as foreign to them as it is to many Americans. P2P networks in all forms are also familiar territory to a lot of net users in China so the idea of P2P money probably has a little wider acceptance than it would here in the US. In comparison to the rest of the world, most Americans are stodgy and conservative in matters relating to currency. Overall, Bitcoin will probably do better in China than it has here in the US.A practical matter would also be that if the Chinese government sees Bitcoin as a threat to Western banking (Western banks have admitted as much), then Bitcoin could be seen as a tool to increase their influence if it can undermine the European Central Bank's and the Federal Reserve's influence. But I do agree with you that if your government (or mine) felt more threatened by Bitcoin, they probably would come down on it hard.