China’s latest bitcoin ban is not a particularly new policy. The country banned bitcoin in 2013 and made ICOs illegal in 2017. This new warning is different because some of China’s biggest bitcoin mining operations were immediately impacted. BTC.TOP suspended its business, Huobi Mall will no longer serve Chinese clients, and Reuters reports that HashCow will not purchase any new mining rigs. Additionally, exchanges in Hong Kong will now need a business license and will only be allowed to provide services to “professional investors,” who are defined as individuals with at least HK$8 million ($1.03 million) in their portfolios.
This news is at least partially responsible for the crazy swings in crypto market prices over the past week or so. The good news: the battle lines are drawn. We’ll see bitcoin mining operations move to locations where the climate is cold and renewable energy is plentiful. Until this most recent ban, more than 65% of bitcoin (and a very high percentage of altcoins) were mined in China. Non-Chinese crypto traders will see this forced migration as positive. We’ll also see renewed efforts to truly decentralize DeFi platforms and protocols which, unsurprisingly, are not all fully decentralized.
Want to know more? My new bestselling eBook, Blockchain – Cryptocurrency, NFTs & Smart Contracts: An executive guide to the world of decentralized finance is a good place to start. Mark Cuban calls it “a crisp, easy to understand overview of crypto and DeFi.”
Want to chat about a blockchain project?
If the form is not visible, click here.
Author’s note: This is not a sponsored post. I am the author of this article and it expresses my own opinions. I am not, nor is my company, receiving compensation for it. I am not a financial advisor. Nothing in this article should be considered financial advice. If you are considering any type of investment you should conduct your own research and, if necessary, seek the advice of a licensed financial advisor.