Crypto Ban in China May Reveal the Targets of the Digital Yuan!

Chinese regulatory authorities have given another shockwave to cryptocurrencies, by imposing a ban on all crypto transactions in 24 September. The action came as the market began to recover from the government's June ban on crypto-mining activities.

while causing tactic Fear, Uncertainty and Doubt (FUD) Which resulted from the ban, in the collapse Bitcoin (BTC) in the rate of 9% within five hours, of the exchange level in the range 45 thousand dollars, to the lowest level at 41142 dollar.

As announced by the company Alibaba Soon, it will ban any sale of cryptocurrency platforms and related accessories, effective from 8 October.

However, the major cryptocurrency has since recovered, trading above pre-ban levels around 45 one thousand dollars. At the time of writing, it was Bitcoin BTC traded in a range 47300 dollar.

This recovery may be against the background of two favorable developments: the signal of the head of the US Federal Reserve Jerome Powell About that no intention to ban Bitcoin Or cryptocurrency in the United States, and Iran lifted the temporary ban on mining Bitcoin.

And while it's not the first time she's recovered Bitcoin BTC Cryptocurrencies have bounced back after the latest Chinese hit more than a dozen times, according to an analysis by Cointelegraph, and this example represents another sign of these inevitable redemptions.

In addition to the drop in the price of the tokens as an immediate consequence of the ban, the long-term impact on crypto companies and investors in China is enormous.

It is reported that Bursa Huobi Global Cryptocurrencies, which are the most used in China in terms of trading volumes, have immediately halted crypto transactions for their Chinese investors, in accordance with regulatory guidelines.

The exchange also set a plan for its users in China, ensuring that users are able to protect their assets before permanently closing their accounts in 3 December.

comment Du Jun Du He is one of the founders of Bursa Huobi Global، in an interview with Cointelegraph:

“Customers will be able to transfer their assets to other exchanges or wallets, over the next few months. In the event that our customers do not see our latest ads, or are unable to do so, we will provide other ways to protect customer assets, and are waiting for them to be withdrawn.”

In contrast to the previous cases, where China cast a shadow over cryptocurrencies, or announced… the ban This time around, it appears that there is no gray area or loopholes that would allow cryptocurrency companies to continue offering their services in the country.

China motive

As with many countries, China's hostility towards cryptocurrencies appears to be coupled with the promotion of its digital currency to the central bank (CBDC), the digital yuan.

where he said Ariel Zetlin-Jones, Associate Professor of Economics at the College of Timber Tepper Business University Carnegie Mellon, Pending Cointelegraph:

“It is clear that China wants to promote the digital yuan, as removing its competitors by banning crypto activities is one way to do so, so it seems reasonable to consider this motivation as one of the rationales for their policies.”

as she said Kristin Boggiano Co-Founder and President of Cryptocurrency Exchange Cross Tower In comments to the site Cointelegraph:

“China appears to be choosing to control innovation, and its actions indicate that cryptocurrency could pose a threat to the digital yuan, as many cryptocurrencies are not authorized.”

The government has been pushing the central bank's digital currency initiative CBDC its own in the various provinces, to the extent that it enabled a region Xiaong'an New, first salary transaction based on blockchain country, in June of this year.

Perhaps this shows a great deal of faith and commitment to the digital currency initiative, compared to other major economies, where the point of discussion is still the security and reliability of cryptocurrencies. Thus, this move could certainly be an attempt to curb the spread of cryptocurrencies "private", and push users in China towards the digital yuan.

Is China's loss a gain for the Americans?

As mentioned June Jun from Huobi Since the stock exchange has expanded its presence in various countries in recent years, business outside China already accounts for nearly 70% of the company's entire portfolio.

Recall that the difficulty of mining Bitcoin It was affected immediately, after a series of crackdowns on mining in China in July, which fell by 30%, like he said Zetlin-Jones Similar results are now visible on Ethereum blockchain When they became mining complexes Ethereum (ETH) Big in China, now offline. continued Zetlin-Jones saying:

“Reducing the difficulty of mining, would reduce the costs of entering the industry, and create an opportunity for new entrants to it. While I think this may be useful in driving the decentralization of mining, it is not clear that this is an opportunity for the United States in particular.”

On the other hand, Charles Allen CEO BTCS Inc., which is a public joint stock company that provides infrastructure for blockchain Still, he's optimistic:

“Enjoy techniques blockchain With the ability to change the world in the same way the Internet did, simply put, it is the future of finance and beyond.”

Allen:

"If China doesn't want to help with development and innovation, it's a 100% chance for the United States in the long run."

Also, the US senator Pat Toomey He has a similar opinion, writing on Twitter:

“China’s authoritarian crackdown on cryptocurrency, including Bitcoin It's a huge opportunity for the United States, and it's a reminder of our huge structural advantage over China."

The opportunity for the United States and other major economies here is huge, as various sectors of cryptocurrency businesses, such as exchanges and mining, need to relocate to China, and thus, will contribute to the economy surrounding jobs and fixed capital inflows.

Despite the absolute clarity on the law of crypto businesses and services, individual investors and holders of cryptocurrency remain unsure whether holding cryptocurrencies is illegal.

has claimed Boggiano, that although investors in China cannot deal in cryptocurrencies via exchanges, direct access to the cryptocurrency market is still relatively unaffected.