China’s difficult relationship with cryptocurrencies can be explained by a succession of restrictive measures. These bans, adopted over the years, reflect a rather cautious approach by the Chinese government towards the sector.

First steps of mistrust: From transactions to ICOs

Bitcoin mining

China’s difficult relationship with cryptocurrencies was palpable as early as 2013. That year, the Chinese government made a decision, deciding to ban financial institutions in the country from carrying out crypto transactions.

This first step demonstrates a growing concern about the rise of cryptos and their potential influence on the local economy. A few years later, in 2017, mistrust escalated, culminating in the banning of ICOs.

By opposing ICOs, Beijing sought not only to protect its yuan but also to curb the illegal flight of capital across its borders.

The Critical Eye on Bitcoin Mining

2019 has seen China take a critical look at another major component of the crypto sector: Bitcoin mining.

The National Development and Reform Commission (NDRC), in a rather startling announcement, labeled BTC mining as junk.

However, it was the realization that several Chinese provinces, including Inner Mongolia, Xinjiang, and Sichuan, had become epicenters of Bitcoin mining that likely prompted such a move.

It should be noted that these provinces, thanks to their resources, contributed about 50% of the global mining power of BTC.

Tightening the Noose: The Year 2020

The People’s Bank of China (PBoC), a state financial pillar, stood out in 2020 with an increasingly rigorous attitude towards cryptos. In August of that same year, the PBoC expressed, through an official statement, its intention to restrict access to a multitude of foreign online platforms dedicated to crypto.

This gesture, far from being trivial, testifies to a desire to strengthen digital controls, thus putting barriers to external influence on the Chinese cryptographic ecosystem. Indeed, the consolidation of these measures reflects a strategic perspective aimed at maintaining a certain hegemony on the digital currency market within the territory.

Thus, while acknowledging the power and potential of the blockchain, China seems keen to preserve and control its financial landscape in the face of the rapid evolution of cryptographic technology.

The Ultimate ban of 2021: Bitcoin Mining in the crosshairs

China’s difficult cryptocurrency relations took a turn in 2021 with a drastic policy towards cryptocurrency mining. Despite China’s predominance in this industry, the decision to completely ban mining was formally enacted in September.

This had the immediate consequence of a major shift in the distribution of Bitcoin’s global mining power, depriving the sector of a substantial part of its operational capacity.

In short, through these successive decisions, China has clearly marked its intentions vis-à-vis cryptos. Despite the importance of new technologies and their potential, the country gives priority to the stability of its economy and its currency.

Name Price24H (%)
Bitcoin (BTC)
$29,211.00
0.30%
Ethereum (ETH)
$1,853.65
0.23%
Tether (USDT)
$1.00
-0.01%
XRP (XRP)
$0.70
3.23%
BNB (BNB)
$237.59
0.19%
USD Coin (USDC)
$1.00
0.05%
Lido Staked Ether (STETH)
$1,853.05
0.23%
Dogecoin (DOGE)
$0.080434
4.73%
Cardano (ADA)
$0.302005
-0.28%
Solana (SOL)
$23.56
2.18%

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