China changes its perspective on Cryptocurrency
One of the most talked-about headlines in Cryptocurrency in the last 14 days, was the Central Bank of China changing its perspective on Cryptocurrency calling it an “Investment Alternative.” With China being one of the economic giants in the world, a lot of people are seeing this as a sign of progress for Cryptocurrency globally.
What’s happened with Cryptocurrency in China in 2017?
In September 2017, Chinese regulatory authorities imposed a ban on Initial Coin Offering (ICO) in the country. China in itself was once the largest buyer of bitcoin so it’s more than understood that upon the announcement, Bitcoin experienced a 6% decline. That same year, authorities shut down local cryptocurrency exchanges. Following the ban, the Shanghai-based BTCC bitcoin exchange was forced to close its Chinese trading operations. The moves were prompted by concerns about financial stability and volatility of cryptocurrency
These regulatory actions are aimed to control Cryptocurrency Volatility which soared to astronomical value in 2017. A lot of questions can be asked about how effective this move was as there was a momentary decline although trading continued in China, as most people shift to foreign exchanges. It has also forbidden China-based financial institutions from dealing and funding with digital currency in 2017.
What is the perspective now in China 2021 and beyond?
On April 18 2021, the deputy governor of PBOC, considered crypto assets as an investment alternative and industry experts are claiming that these comments are “progressive, “ considering the role China plays in the crypto space.”
In 2020, China was amongst the top five countries with the largest Bitcoin investments. Along with investments, China also is a global leader in Bitcoin mining, with over half of the world’s capacity coming from China, as a lot of regions offer cheap subsidized electricity, making mining a profitable venture.
This recent comments has been seen as a positive outlook for the Cryptocurrency world ahead, with Vijay Ayyar Head of the Business Development at Cryptocurrency Exchange Luno, stating “Governments are realizing that it is a viable and established, yet growing, asset class and need to regulate it. China regulating crypto would be another massive boost to the industry in China and globally.”
With the growing adoption and attention of the asset class, many financial institutions and governments want to keep ahead of the game. Although China’s current focus remains on developing and implementing its digital yuan but it still remains whether these comments are a teaser for a bigger move in regulating crypto.
If you would like to know more regarding the world’s first hybrid cryptocurrency , you can visit us at www.nagaya.io
Or come talk to us at t.me/nagayaofficial
