News coming from China has shacked the crypto world recently. Bitcoin price skyrocket from the previous slump. But what exactly has happened?
The revelations from China became a hot topic in the cryptocurrency industry during the last few days. President Xi Jinping’s words were a surprise for the industry, mostly focused at this time on Libra and Mark Zuckerberg’s testimony. Is that news a game-changer in the blockchain world?
Enter the Dragon
During an18th collective study of the Political Bureau of the Central Committee, the president of the People’s Republic of China has raised a topic of blockchain technology, and how China could benefit from it. The leader of the Communist Party of China announced this way a new focus for the country, and call his fellow members to support the idea.
Soon, the whole industry was crazy about the news for Asia. China, the country which banned Bitcoin a few years ago, is now changing the course on the crypto direction. Until the announcement, Bitcoin’s price was slowly dipping down, but Xi Jinping’s words reversed this trend, bringing it back in around $ 10,000. Some people have even begun to think that China is “unbanning” Bitcoin.
Good time for crypto?
That’s not going to happen. The basic policy for cryptocurrencies remains the same. Actually, the cryptocurrencies weren’t even mentioned in Xi Jinping’s statement. But it was enough for investors to throw their money into Bitcoin (as this meme on Reddit perfectly shows). But Nakamoto’s coin wasn’t the only one that received attention after the last revelations.
Many cryptocurrencies have Chinese roots. The news of CPC’s shift toward the blockchain has also influenced those projects. Coins like NEO, Tron, or Vechain have significantly gained on this reveal. It was a predictable impact of the announcement. For daily traders and investors, blockchain is almost a synonym for the word “cryptocurrency.” That’s why the market reaction wasn’t surprising.
Crypto arms race
Maybe China isn’t going to open on cryptocurrencies soon, but its plans for the blockchain industry are still impressive. In general, Xi Jinping calls for introducing blockchain technology into the Chinese national structures. This revolution will probably begin by preparing appropriate regulations. Such law would need to be taken into account with China’s economic system.
Such a complex process creates a demand for foreign developers, who will find lucrative work offers in China soon after the Xi Jinping’s plan come to life. The Chinese economy is a leading force among other countries, so they probably won’t fear about money. Moreover, the national focus on blockchain technology will also influence society, making them more aware of its possibilities.
Those revelations came not even a week after Mark Zuckerberg’s warning of Chinese plans for developing their own stable coin similar to Libra. Although his words were nothing more but a call to the American patriotism, the convergence of those events is significant. Both China and the USA are the leading economies of the world. In both countries, cryptocurrencies are an important topic during the last months. For now, these are only divagations.
But let’s back to the actual topic. Is China going to be a cryptocurrency hero? It’s hard to predict now. On the one hand, Chinese progress in technology development is tremendous. This country efficiently transformed adjust to standards of the modern economy, becoming a significant worldwide player. The cryptocurrency market reaction on Xi Jinping’s words shows it very well.
On the other hand, its policies face criticism from the rest of the world. Such events like Hong Kong protests can’t be covered by announcing Chinese support for the blockchain. Unfortunately, this technology is only a tool. And soon, we will see how the People’s Republic of China will use it.
One thing is for sure. China is the country that could afford on complex shift to the blockchain, implementing it in many aspects. But since one of the highest value of this technology is decentralization, will it suit to the centralized, planned economy?
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