It sounds like China is really warming up to bitcoin and cryptocurrencies as of late.
China: Mixing Things Up Even More
The latest price hike for BTC has ultimately come about largely because Chinese president Xi Jinping commented that blockchain technology could bring his country’s infrastructure to new heights. Thus, he’s planning to push blockchain innovation very hard in the future.
But prior to these words, it’s known that China hasn’t always been friendly to crypto. For one thing, the country has banned both foreign crypto exchanges and initial coin offerings (ICOs), a once popular form of startup funding that has seemingly disappeared somewhat due to past fraudulent activity.
In addition, China has long considered a full ban on bitcoin mining, claiming that it presents serious hazards to the environment. However, no steps have been taken towards initiating such a ban, so it’s unclear if this is just talk or if the country is legitimately planning to step in where it thinks it’s needed.
Now, the China Merchant Bank is investing in a new crypto wallet platform simply known as Bit Pie. The company is allegedly a wallet system that has long served Chinese bitcoin enthusiasts. Despite several steps taken to ensure crypto activity doesn’t occur within the nation’s borders, Bit Pie ultimately stayed afloat by relocating to Australia last year and has retained a healthy customer base in China.
Dovey Wan, the founding partner of Primitive Ventures, took to Twitter to express his excitement over the news. He says that China, given President Xi Jinping’s recent comments, is likely to become a blockchain and cryptocurrency leader in the coming months. Discussing the president’s words, Wan explained:
All I can say is this, to me, is a sign of beginning the nationalization of bitcoin and cryptocurrency-related infra on the mainland. Eventually, all things can be state-owned, or at least partially (mining, ASIC, exchanges, wallets, etc.)
At one time, China accounted for most of the world’s bitcoin transactions. This has eased down somewhat over the past two years ever since the country decided ICOs were no longer legal, but China is studying blockchain and artificial intelligence (AI) as a means of capturing the “cross-border financing market.” Thus, foreign workers or employees working and/or living abroad can potentially use blockchain in the future to send funds home to respective family members.
The Future of Regulation
At the same time, however, China is initiating a new crypto-based rule designed to tackle blockchain startups. The sentiment is that crypto comes with plenty of legal issues and other challenges, and thus the country wants to be prepared as it readies the launch of the digital yuan, which at press time, is set to occur in early 2020.
The currency was originally introduced as a means of competing with Libra, Facebook’s new digital currency.