Recently, rumors have circulated that Bitcoin is being “liberated” in China, from unsourced tweets to incorrect reports about the Chinese Communist Party’s plans for Bitcoin. Since Hong Kong legalized a Bitcoin spot ETF, those rumors have multiplied. To understand those rumors, you will have to understand the existing legal status of Bitcoin in China and what the Bitcoin bans mean, a topic I studied in depth in my e-book on Bitcoin and China.

First of all, we want to perceive what is happening in China right now. After the Hong Kong protests, the lines between the “One country, two formulas” dynamic that promised Hong Kong a form of government different from that of the mainland narrowed. However, when it comes to Bitcoin and cryptocurrencies, Hong Kong has another formula and regulators. This has allowed Hong Kong to remain legal to trade Bitcoin, and new regulations limit drive-thru counters, physical coin outlets where you can display coins and get Tether or Bitcoin, or the other way around; For now, they operate under an exemption. for peer-to-peer replacements. Hong Kong’s constitution, the Basic Law, enshrines some protections for Bitcoin trading. Therefore, it is unlikely that Hong Kong will ever ban Bitcoin trading like mainland China has done, until there is an update to the Basic Law.

Hong Kong spot Bitcoin ETFs are attractive because they involve three major mainland Chinese asset managers through their Hong Kong subsidiaries (ChinaAMC, Harvest, and Bosera. However, for now, mainland Chinese investors are prohibited from investing in Hong Kong Bitcoin spot and futures ETFs. Issuers have rarely cited “extraterritorial” interests from the continent.

This is because Bitcoin is strictly regulated in mainland China. People have been arrested for trading Tether only and virtual currencies (along with other crimes). Bitcoin mining is banned, Bitcoin mining gatherings are moved out of mainland China and significant amounts of hashing are done/ Bitcoin exchanges are no longer used for the yuan industry instead of cryptocurrencies, and regularly ban Chinese IP addresses from accessing their facilities, and many foreign exchanges have their IP addresses blocked through the Great Firewall.

China’s Bitcoin bans are a set of regulatory notices that intensify year after year, involving law enforcement in 2021. At the same time, Chinese courts have at times held that Bitcoin is a legally protected asset (and very They will probably continue to do so. – which makes headlines that China reconsiders Bitcoin every time).

There have been headlines related to China, such as a Hong Kong professor who thought banning Bitcoin mining was a mistake because it increased US tax revenue. It is entirely imaginable that China will examine Bitcoin as it did with “blockchain” and Web3, and that the headlines will continue in that direction, especially with the prospect of a pro-Bitcoin Trump administration.

Probably very little maximum. Most technical agencies that prohibit/regulate Bitcoin, such as the People’s Bank of China and SAFE, which administers capital controls, follow a political trajectory that spans decades. While it is true that in the afterlife Xi Jinping’s words have led to an acceleration and policy replacements, the mining bans were imposed through Liu He, one of Xi Jinping’s most trusted economic advisors. Given that Xi Jinping will likely be in place until at least 2029, he would like to make a radical turn to replace his well-established political trajectory, despite the deep ideological struggle against Bitcoin within the Chinese Communist Party.

China was one of the first countries to recognize the risk Bitcoin poses to its model, from strict capital controls to power controls. China’s progress on the virtual Yuan is not so unexpected considering that the greatest tension in Chinese politics lies in the degree of control the Party exerts over the economy. The policy of spreading central bank virtual currencies and replacing Bitcoin is unlikely to be the opposite, meaning that China’s headlines are unlikely to involve policy adjustments; would possibly support value sentiment as the headlines reflect China’s continued acceptance of Bitcoin as property, Hong Kong reports. with the Bitcoin spot ETF and close examination through the US president. A date of absolute and long-term precedence for the Chinese party-state.

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