A haze of fog has descended as clarity awaits on China’s move following reports the country is to ban crypto exchanges with twitter activity picking up tonight, ten years on from the begining of the banking crisis.
Jihan Wu, who runs the biggest mining operation in the world, made a series of public statements on twitter, suggesting something might be brewing, starting with:
“Bitcoin is not banned in China, but only Bitcoin exchange business is about to be banned (according to rumor).”
We are told there is no official confirmation, but the rumors are “likely-true-rumors.” Wu continued to publicly state in a series of tweets:
“None of the Bitcoin exchanges in China has the licenses that should be required for order book exchange. Such law is older than Bitcoin.
Some established China Bitcoin exchanges stop operation right now does not mean that they cannot open again once with license.
If some Bitcoin exchange operates inside U.S. without licenses for years and later is asked to stop operating. Is it U.S banning Bitcoin?”
Events may make that question less relevant than a new one which is starting to rise. What exactly is PBoC planning?
Rumors are swirling China’s years long statements on plans to issue a digital currency of their own, like bitcoin, might be reaching a state where the country is ready to implement their aims.
None of it is confirmed, with the situation in this fog ripe for exploitation and manipulation. But PBoC is familiar with this space. One of its directors even sang praise to ethereum as we reported in June.
Back last year PBoC said digital currencies are the future. It is probable the same personnel is in charge, making their outright ban puzzling, but if they are to indeed issue their own bitcoin like version, much may make sense.
China is the most advanced country on earth as far as digital payments are concerned. Their Fintech industry has risen to a $100 billion market. While giants like Tencent account for more than 50% of payments in the country.
They have bypassed the banking system as we know it here in the west because the infrastructure was not there. So adopting the latest technology, with QR codes everywhere, even for buying oranges.
It is difficult, if at all possible, to operate in this ancient land without an e-wallet. A vast ecosystem over which PBoC has little control.
The issuing of a digital currency, codable money, might once more place them in charge. But the move would open a very new world. A world that would force this space to grapple with some difficult questions, a task it isn’t quite ready to do.
Nor is the infrastructure in any way ready. Such hasty move would necessarily lead to failure, because the timing, at scale, is simply not right.
Another five years, at minimum, are needed. Therefore it is all most probably rumor. But China must lift the fog. And they must stop playing with both us and the rest of the world.