American economist Peter Schiff believes that it is in China’s cynical interest for the United States to open up to cryptocurrencies. Meanwhile, Tron’s Justin Sun believes that Beijing should change its policies and start attracting blockchain talent.
China and Bitcoin
If you remember 2013, you know that the BTC boom was “sponsored” by the Chinese. Not the government, of course, but ordinary citizens who bought cryptocurrencies en masse. The reason? The desire to make money, fueled by an almost national passion for gambling.
Then it got worse. The Chinese government restricted cryptocurrency trading in 2017, banning banks and payment systems from handling digital assets. The ban was circumvented in various ways, but trading in bitcoin and altcoins was difficult. In May 2021, the People’s Bank of China (PBOC) also declared all transactions made using bitcoin and other cryptocurrencies illegal. Mining was also banned. This year, the media also wrote about Beijing’s desire to tighten the system and make it even more difficult to purchase coins.
Does China support US pro-cryptocurrency policy?
Now, in addition, Peter Schiff indicated in a post on X that “China is not interested in bitcoin” and “has made its mining illegal.” He puts all this in a broader context. He believes that it is in Beijing’s interest for Washington to open up to cryptocurrencies. The point is that the US, by buying bitcoins, for example, will be “wasting its resources.” In the meantime, China “focuses on producing goods that people need.”
Schiff referred to Donald Trump’s plan, which announced that as president he would support the blockchain industry. He promised to block any attempts to sell the 200,000 BTC that the US has (these are funds seized from criminals). The economist quoted above questioned the logic of such thinking. In his opinion, exclusive BTC farming makes no sense. You simply have to make money on the investment.
What is the appeal of living in poverty, dying with a large pile of Bitcoins, with subsequent generations of heirs repeating the process?
– he asked.
Justin Sun Wants China’s Policy Changed
Justin Sun, the founder of Tron, sees the matter differently. He even appeals to the Chinese authorities to open up to BTC.
Sun recently stated that competition between China and the United States in cryptocurrency regulation will benefit the entire industry. The idea is that competition will force regulators to create the best possible legal environment for companies, which will support development.
Many analysts, however, point to the fact that cryptocurrencies could undermine the power of Xi Jinping’s regime. After all, they are harder to control than fiat currency.
Perhaps to make it even more difficult to assess bitcoin’s situation in the region, Hong Kong has opened up to Satoshi’s currency. Buying cryptocurrencies has effectively become legal there. Some believe this is a preview of what Xi Jinping and his people will do.
What is the truth?
So what is this complicated puzzle all about? We don’t know what decisions Beijing will make. However, we can assume that even if China opens up to cryptocurrencies, it will do so in some respects. The industry will be strictly regulated. It is possible that Bitcoin will only be able to be used in cross-border trade (like in Russia). Then it would make sense. The Chinese will be able to use BTC to bypass any restrictions that the US could impose on them. So they will use digital assets in the trade war.
The question is whether the latter will be followed by liberalization of exchanges. It is possible, but let’s not be naive: China will not allow free circulation of currencies based on decentralized technology in the foreseeable future.
