Chinese Demand Rallies Bitcoin Prices, Online Services to Replace Silk Road

So much for Silk Road’s demise taking a bite out of bitcoin’s global demand. Since the announcement of the FBI seizure of the website, prices tanked below $100, only to rebound and rally to their highest levels since May. Currently trading at $145 on BitStamp and $160 on MtGox, bitcoin prices are now more than 10% above their pre-Silk Road seizure levels.

In a story being covered by our sister site, Payment Magnates, driving the demand has been the announcement that Baidu, touted as the ‘Google of China’, will begin to accept bitcoins for payment of its Jaisule, firewall and DDOS services. With the news, Baidu becomes the largest and most recognizable firm to begin to accept bitcoins. It also further demonstrates the interest of the Chinese population in bitcoins and virtual currencies.

As a result of the news, and demand from China, trading at the BTC China, the country’s largest bitcoin exchange has more than doubled. In terms of total market share, according to statistics from Bitcoinity, over the last three days BTC China’s market share of bitcoin volumes across exchanges has risen over 22%, from around 10% a month ago. With the activity, BTC China is now sitting near BitStamp and MtGox as the top three exchanges in terms of volumes.

Online services, the new Silk Road

In regards to Baidu, among the issues affecting bitcoin’s adoption among consumers is a relatively small market to spend them. While there is a growing group of websites, cafes, and bars that accept them, the reality is that taking into account the price Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad Read this Term and fees involved in acquiring bitcoins, for local purchases fiat currency still rules.

One area where bitcoins could dominate is with online services. Unlike sellers of physical goods, where margins are tighter and currency fluctuation have a greater effect on bottom lines, operating margins on digital services are nearly 100%. While software companies and operators of digital marketplaces that sell MP3 songs and e-books retain costly infrastructure and employees, from a cost of goods perspective there is very little difference how much is sold. In addition, as online businesses, country borders are much less of a boundary to doing business. Due to these considerations, bitcoins are a natural fit for online service transactions.

In this regard, Baidu’s announcement is more than just a large firm accepting bitcoin. What Baidu brings to the table is a major digital service business with a large footprint among technology users, who are more likely to be holding bitcoins than the average online consumer. As a result, if proven successful, especially in regards to attracting additional global clients, Baidu is primed to become a trendsetter to many more services embracing bitcoin Payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term.