Will China Ever Recognise Cryptocurrencies?

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Will China Ever Recognise Cryptocurrencies?

China is a
country full of technological advancements and is often found right
at the forefront of these leading changes. Cryptocurrencies, in a
sense, are no exception to this rule. However, while China has been
known to make up a good chunk of the mining community, it’s quickly
becoming clear that the country isn’t quite as open to these
decentralised coins as most may think. With their recent clamping
down on all things cryptocurrency, from social media to investment
apps
, could China ever recognise cryptocurrencies as something
good? We’re exploring exactly that, below.

A Previous
Stance

China’s
previous stance on cryptocurrency is pretty much how you’d expect
for something that the government can’t control – they found a
way to control it. Initially, ICOs were the only banned entity
surrounding cryptocurrencies, but this has gone further to the point
of banning internet and mobile access to anything related to these
digital coins. What’s more, despite 50% of the global mining
population currently
operating in China
, the government were also removing miners from
the country.

But with China
still sitting as leaders in the industry, particularly for
cryptocurrency adoption, could we see China finally embrace these
coins, or try and stamp them out altogether?

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Could They Be
Opting For A Regulated Cryptocurrency?

According to Zhou
Xiaochuan, governor of China’s central bank, the country is likely
to try and regulate cryptocurrencies slowly due to the fact that
“digital currency is inevitable.” As a country filled with
contactless and mobile payments and with cash becoming increasingly
rare as a choice for payments, it’s not difficult to see why this
might be the case and why the bank in particular could be on board
for providing regulation as opposed to a complete ban.

With rumours that
the central bank is already doing its part to research into
cryptocurrencies and their related technologies, it’s also been
confirmed by Zhou that there’s no rush for regulation and that they
are moving
cautiously with cryptocurrency
. With ongoing crackdowns on social
media and internet mentions still ongoing, however, more and more
crypto fans and enthusiasts could soon be calling for faster research
and more in-depth regulation on a larger and much more efficient
scale.

Could They
Launch Their Own?

While regulation
will provide a certain level of protection over crypto use, China are
considering going one step further with The People’s Bank of China
even talking about launching their very own official cryptocurrency
called DCEP. Zhou had claimed that the lure of cryptocurrencies
relied on efficiency of payments, and of course privacy and security,
and thus this new coin would offer all. Through embracing blockchain
technology, the PBoC could provide a new currency that could better
cater to China’s ‘needs’ and ultimately offer a new kind of
retail payment system that mimics cryptocurrencies without the lack
of control by the government.

China’s future
with cryptocurrencies is certainly still a murky one, but it’s
looking far more promising than it has previously. With the central
bank seemingly considering regulation or even the introduction of
their own cryptocurrencies to cater for the market demand, it’s
certainly looking brighter than it has in previous years. What do you
think?

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