Just like the european sword knot the tassle on chinese jian once was simply a security loop to the writs.

With the jian sheethed the loop was bound to the suspension fixtures in a way that doubled as a security sword retainer and got the looped rope out of harms way.
The looped ropes featured a bead that prevented the end from being pulled trough the securing knot and also provided an easy to find and good grip to rapidly pull the knot free.

Sofar I have not found an explanation of the knot used. I have found a perfectly good knot that COULD served but would like to know which was used.