Digital currencies are becoming cheaper across the board after China announces that it will take tougher action against digital currencies. The Communist Party itself is investing heavily in blockchain technology.
Bitcoin, the oldest and best-known digital currency, continues to suffer heavy losses. On Friday, a Bitcoin was only partly quoted at 6952 dollars, its lowest level since mid-May.
Still at the beginning of the week there were more than 8000 dollar. Thus the course loss in the past ten days adds up to more than 20 per cent. This also effects all BTC casinos, which you can see listed on this website.
Chinese central bank
Reason is a new campaign of the Chinese central bank against the trade with digital currencies. The People’s Bank of China announced that it will take action in Shanghai against illegal activities related to digital currencies. It also warned that crypto currencies should not be confused with its underlying blockchain technology. President Xi Jinping recently spoke out in favour of intensifying the development of blockchain technology and sent Bitcoin on a small rally:
“It’s unprecedented that China’s leadership can lift a technology to such a level,” said Zhang Gang, chief analyst for Central China Securities, the financial news agency Bloomberg. “It’s a huge boost to market confidence.” In addition, the Chinese Central Bank said that the blockchain technology could help control risks better, and make it easier for small businesses to borrow money.
Own digital currency
The central bank has been working on its own digital currency for some time now. The change of mood is remarkable in that China has always been tough on digital currencies. The Chinese Communist Party (CP) is not quite so familiar with all this, not to say: not at all. At first, the CP observed it with interest.
Even the state broadcaster CCTV produced a lengthy report on the network money – unthinkable without the approval of the Beijing state leadership. Later, trade in yuan was completely banned, and mining, i.e. the production of cryptode currencies, was at least severely restricted.
China’s attitude seems to be contradictory, but it is not. On the one hand, they do not want to grant their own citizens the freedoms that digital currencies can bring with them. On the other hand, one wants to use the advantages and perhaps take a leading global role.
Some even speculate on the extent to which this is already the case today. There are theories about this like sand on the sea. Perhaps the Communist Party sees digital currencies as an attack on the established currencies of the West, perhaps it is itself involved and is raking in billions, perhaps it only sees it as an exciting experiment – at any rate, the supposed anonymity of crypto currencies leads to a lot of speculation.