The Bitcoin and cryptocurrency ecosystem went into a tizzy on November 11, 2019. This was because, China, one of the world’s leading economic superpowers in the world announced something dramatic.
The question then arises is- Bitcoin Success in China? The Chinese State-run newspaper, Xinhua, published an article hailing Bitcoin and Blockchain technology in a full-page article. China’s powerful 1.4 billion population has been kept away from Bitcoin ever since China banned trading the digital currency with Yuan.
However, the November 11 newspaper article is increasingly being seen in a positive light by the world. This not only opens up the possibility of China using Bitcoin but also increasing the valuation and record pricing of the digital currency.
In this article, we will look at whether this is good news and how it stands to influence Bitcoin valuations in the world. We will also look at whether China is in the process of developing its own digital currency.
China and Cryptocurrency: The Change in Attitude
If you have an idea about how the Chinese government runs the economy and financial system you will recall how China was averse to its population using digital currencies sometime back.
This was because of a number of reasons, the biggest of them was the fact that the government thought about it as a move by the west to control China’s financial systems. However, the recent article in Xinhua has put forth some clarity on this preconceived notion.
It should be pointed out that the article had high praise for Blockchain technology, extensively talking about how the tech is secure, peer-to-peer, and trustworthy. It also extensively talks about Bitcoin mining, scarcity, the use of Bitcoin mixer, and how and why the movement should be viewed.
Skeptics point out that there is no point rejoicing so soon. They state that the article also talks about the dangers of Bitcoin being used in grey and dark markets. Along with the problems of usage, the article states that a sovereign physical government does not back the currency. Nor does it draw its value from a fixed and regulated financial system of assets.
Is China readying its own Digital Currency?
There has been news and chatter about China using Bitcoin technology and rolling out a digital version of its currency Yuan in early 2020. Just like a Bitcoin wallet, the new Chinese digital currency will be tokenized money.
However, unlike Bitcoin, the digital yuan is going to be backed by the national bank of the superpower economy. The rollout is expected to be slow but is going to be easily adopted as the Chinese population already has experience of working with digital wallets like Alibaba and We Chat Pay.
China’s President Xi Jinping made headlines that technology has a lot of potentials and should be explored. The recent rise in the valuation of Bitcoin can be attributed to China’s positive stance on Bitcoin and Blockchain development.
It should be pointed out that China is not the only country looking to formalize Bitcoin and Blockchain to be part of government bodies. Singapore has set up Project Ubin, by collaborating with JP Morgan Chase. Tunisia too is going to launch a state-backed digital currency in early 2020. However, being a superpower, China’s recent announcement holds a lot of value and importance for the cryptocurrency world.
Will Bitcoin and other Cryptocurrencies benefit from China’s new stance?
While proponents of Bitcoin point to the recent rise in Bitcoin valuations following the Xinhua article, critics point out that this is mere speculation, as China is never going to open up its economy to any foreign currency.
There is no doubt that the advantages of Bitcoin and Blockchain technology have made even a conservative country like China stand up and take notice. While China may not directly endorse Bitcoin and develop its own digital Yuan, there can be no doubt that this is going to give a substantial boost to the value of Bitcoin and other cryptocurrencies like Ethereum.
Conclusion
It should be noted that Bitcoin is going mainstream because of the huge number of Bitcoin Trading Platforms that have arisen all over the world. People who do not have the investments to go in for Bitcoin Mining can still make Bitcoin Profit by trading on such platforms.
By using technology that enables one to go through millions of calculations at one go, Bitcoin software is revolutionizing the world of Bitcoin, as we know it.
The year 2020 is going to be a very interesting year for digital currencies. With more and more national governments experimenting with Bitcoin and Blockchain tech, digital currencies are expected to become more mainstream.
China’s stand on Bitcoin is going to be played out in recent months. While the world anxiously waits for the digital yuan, one thing is for certain, digital currencies are the future of the financial systems.
Do you think China is going to open its market to Bitcoin or other cryptocurrencies? Do let us know in the comments section below.
Read Also:
