Bonnie Girard
In 2017, the Chinese government was the largest cryptocurrency market in the world. It is estimated that as many as 80 percent of all Bitcoin transactions were taking place in Chinese currency, the yuan (also known as the renminbi), at that time. Cryptocurrency exchanges in China were busy and proliferating. The availability of cheap electricity, particularly in regions like Sichuan, made Bitcoin mining a lucrative business.
However, at the height of what seemed like an unqualified success for China’s adoption and use of digital currencies, on September 17, 2017, Coindesk reported that a document leaked on social media “appeared to confirm rumors that all local Bitcoin exchanges must close by the end of the month.”
Indeed, that’s exactly what happened. With no public consultation, no advance notice, and no appeal mechanism, the Chinese government shuttered an international financial product that had gained acceptance and then thrived among everyday Chinese investors. The Chinese Communist Party (CCP) had let the Bitcoin party run for as long as it was expedient. Once the venture became too strong for its own good, and therefore too risky should it fail, the government had no choice but to eliminate it before either eventuality played out.
There are three reasons that China has a problem with cryptocurrencies.
No comments:
Post a Comment