Why the Chinese Love Bitcoins
The Chinese have found a new investment that sidesteps the scrutiny of the country’s authorities. And for now, it’s paying off big.
Bitcoins, a virtual currency invented in 2009, is attracting investment-hungry Chinese who often struggle to find good assets that generate high returns.
The investments have paid off for people like Sun Minjie, a 28-year-old Internet worker who lives in Beijing. He paid about 28 Bitcoins, worth roughly $3,000 at the time, for more than 400 shares in virtual stock exchange 796 Xchange. He’s seen a 46 percent return on his investment since its Aug. 1 debut. Compare that with the 2 percent gain on the Shanghai Composite Index for the same period.
It’s no wonder why China has surged from seventh place in global Bitcoin collections last year to second, ranking only behind the U.S. In the past month, a flurry of local IPOs priced in Bitcoins, including 796 Xchange, Myminer and Labcoin, have also listed on virtual Bitcoin stock exchanges.