China Cryptocurrency News
China Cryptocurrency News – As the most populous country in the world and the second-largest economy, China holds a very influential place on the world stage. As such, its stance on various technological advancements and their applications is quite important, owing to the global nature of such breakthroughs.
China generally takes a closed-off stance on technology and its policies on cryptocurrencies match its views. But instead of the usual embargo, China has had a love-hate relationship with these digital currencies. The recent news, make it clearer than ever that this tug of war is set to continue.
No Mining Ban
After months of speculation and rumours, that the government is going to crack down on cryptocurrency mining activities in the country, it seems like that is no longer the case. This has been confirmed by the authorities, and it marks a really bullish case for Bitcoin in particular. Most of the Bitcoin miners in the world are based in China, thanks to the availability of cheaper electricity and this news should come as a much needed relief to them.
The change came courtesy of the new edition of China’s Industrial Structure Adjustment Guidance Catalogue, wherein, cryptocurrency mining has been removed from the list of industries, that the government wants to eliminate. This step was taken by China’s National Development and Reform Commission. The presence of Bitcoin mining in this list of ‘undesirables’, in the last edition of the catalogue, had sparked a lot of speculation about the government’s intentions.
This latest news can be inferred as China not wanting to be left behind when it comes to having a stake in the cryptocurrency industry. If these new financial instruments do take off in the future, it would be in China’s best interests to be involved from the ground level. As far as Bitcoin is concerned, that ground level is its mining.
Chinese Crypto Coins Moon
A little over three weeks ago, the Chinese president made an announcement that took the blockchain and cryptocurrency industry by storm. In his announcement, he called for accelerated adoption of blockchain technologies in the country. He stated the importance of blockchain, as being a core of independent innovations. He also called for clarifying of policies to drive investments into this area. Speaking of the news, Michael Novogratz, founder of Galaxy Digital, said that President Xi had “just credentialized crypto and blockchain”.
On the heels of this news, Bitcoin saw one of the highest increases in price on a single day, in its history, rising to $10,540 from $7400, before correcting downwards. Many Chinese cryptocurrencies like Neo, Tron and ONT, increased anywhere from 20-70% in prices. Since then, they have only continued to surge upwards. This was despite the fact that President Xi’s announcement was more about blockchain than about cryptocurrencies.
The day after Xi’s supporting comments about blockchain, China passed its first-ever cryptography law that will come into effect on January 1, 2020. The new law was passed to set standards for the applications of cryptography and the management of passwords. Merely days later, the Chinese Guangzhou government announced a $140 million subsidy fund, to encourage blockchain adoption. According to reports, the plan is to sponsor two blockchain-related projects every year. However, these do not include projects with cryptocurrencies.
China’s State Cryptocurrency
China has had a really negative stance on cryptocurrencies in the past many years. This is typical of the way the government there thinks about technology, that it doesn’t own and control. Therefore, after banning trading activities in 2017, the central bank of the country has been working hard since last year to develop their own cryptocurrency. This puts them alongside other countries that are trying to develop central bank digital currencies (CBDCs) as well.
When Facebook announced its own cryptocurrency, Libra, in June of this year, it raised concerns even more for the People’s Bank of China (PBOC) and they accelerated the development of their digital Yuan. Their end goal is to replace cash and coins in the economy to establish a completely cashless society. Crypto enthusiasts say that this goes against the very nature of cryptocurrencies which are decentralised and where the people are in control.
According to a recent research report, digital currency will be two-tiered. The first tier will connect the PBOC with the commercial banks and the second tier will connect the commercial banks with the retail market. Reports have surfaced from many sources in the past few months, including from officials from the central bank, that China is very close to launching their digital currency. If that happens, it will be the first country in the world to launch its own cryptocurrency.
China Considers Bitcoin Successful
After a lot of to and from, China seems to be making its stance on bitcoin and its stance a little clearer, in 2019. Throughout the past few years, the country has had a rather negative view of this space, to the point that they cracked down on exchanges and other service providers. Although there has been no explicit ban on holding cryptocurrencies and transferring them from one person to another, the Chinese government’s hard-handed strategies haven’t made life easier.
Now, however, one after another, news is emerging out of China that has crypto enthusiasts in the country as well as all over the world, hopeful of a better future for the crypto space. Recently, a state-run newspaper there published a full, front-page story about how Bitcoin is the first successful application of blockchain technology. After years of being called a Ponzi and fraud, this is a rather significant change in their stance.
Not only that, but the article also talked about how Bitcoin and its underlying technology work. They acknowledge Bitcoin’s popularity and its benefits as well. But in typical Chinese fashion, they also mentioned the adverse effects that the popular cryptocurrency can have, like its use in the dark web and black market transactions. Regardless, China talking openly about Bitcoin is in itself huge.