China as a country has a complicated history with cryptocurrency as in 2018, they instituted a law that banned all cryptocurrencies though citizens continued to trade in them cryptocurrency using virtual private networks. Now in 2019, it has been reported that the country is developing its national token which is due to hit the market soon and is believed to be in response to Facebook’s upcoming Libra token which is poised to become one of the biggest cryptocurrencies in the world.
Now, it has been reported on September 14, 2019, that regulators in Mongolia, which is an autonomous province, has issued notices requesting a cleanup of the local crypto mining industry which is yet another layer in the complex treatment of cryptocurrency within China.
Five departments which are the Development and Reform Commission, the Public Security Department, the Office of the Ministry of Industry, The Financial Office and the Big Data Bureau are involved in the cleanup efforts and their reasoning behind this is that crypto mining is linked to an unstable industry.
“The virtual currency ‘mining’ industry belongs to the pseudo-financial innovation unrelated to the real economy, and should not be supported,” the report said.
It is interesting to note that about 70 percent of all bitcoin mining worldwide takes place in China despite its often hostile nature to cryptocurrency and many have stated that this new development will have a little impact on mining as miners will continue to carry out their activities regardless. At the same time, the statement put out by the various bodies shows a very consistent attitude which is that cryptocurrency and the industry behind it is not real or legitimate but rather a scam and a fad. Despite all the progress of cryptocurrency has made in the last few years, this perception still needs to be addressed and hopefully, as crypto becomes more popular, it will die out.
It was also reported that China’s National Development and Reform Commission is looking into issuing a cryptocurrency mining ban across China which could have significant implications as because China is responsible for so much of the world’s crypto mining supply, it could take a hit and also, the industry could be forced to go underground in order to survive. Again, several Chinese miners have said that a potential ban will not stop them the same way it did not stop the trading of cryptocurrency and this shows just how enthusiastic sections of the Chinese population are about cryptocurrency as well as their resilience.