Amid fresh reports on social media suggesting that China might lift its long-standing ban on Bitcoin, the cryptocurrency community remains skeptical about this possibility.
On July 14, Galaxy Digital CEO Mike Novogratz shared on X that he has been hearing reports suggesting China is “likely to unban” Bitcoin (BTC) by late 2024.
“If this is true, and it’s the second time I’ve heard in weeks, it’s a huge deal,” Novogratz wrote, asking the community to provide more insights on the issue.
China has repeatedly “banned” Bitcoin
Most replies in Novogratz’s X thread have questioned the source of information. Many posters expressed doubt regarding China’s potential U-turn on Bitcoin. Some posters also argued that China has never put a blanket ban on Bitcoin.
“They have banned it like six times, and nothing has happened. The same thing will happen when they ‘un-ban’ it multiple times,” one poster noted in the comments.
The commenter referred to mainland China’s multiple efforts to prohibit certain activities related to Bitcoin and other cryptocurrencies, including an interdepartmental crackdown on crypto in 2021 and a ban on crypto exchanges in 2017.
Despite the strict measures, China has managed to remain a global leader in Bitcoin mining and other crypto activities.
Some industry observers are still optimistic about China’s potential Bitcoin U-turn
Some online posters were still optimistic about the latest social media reports, particularly given recent criticism of mainland China’s approach to crypto regulation.
In late June, Hong Kong University of Science and Technology professor Wang Yang reportedly questioned the logic of China’s ban on crypto mining, urging the government to embrace crypto amid geopolitical risks.
According to the professor, completely banning crypto mining in China was “very unwise” as it drove related businesses to the United States and contributed to US tax income.
China “unlikely” to have any motivation to open to crypto
In response to the latest social media reports, several industry figures expressed confidence that China would never allow its citizens to freely trade Bitcoin using local fiat currency.
“If you refer to ‘unban Bitcoin’ as China would allow Chinese citizens to buy Bitcoin with China’s renminbi from inside China, it is not going to happen, period,” said Yifan He, CEO of major Chinese blockchain firm Red Date Technology.
“Whoever suggests this has no slight idea why China bans Bitcoin and cryptocurrencies,” He told Cointelegraph.
The CEO also mentioned that one should pay attention to Hong Kong-based exchanges like HashKey, which do not allow mainland Chinese citizens as customers.
Related: Hong Kong flags 7 unregulated crypto exchanges for noncompliance
Mikko Ohtamaa, co-founder of algorithmic investment protocol Trading Strategy, echoed He’s stance, arguing that China’s U-turn on Bitcoin would be against the government’s political agenda.
“It is unlikely the rumors China is opening for crypto are true, as this would be against Xi’s agenda on how the Chinese state is built,” Ohtamaa told Cointelegraph. He added:
“China’s concern with crypto has always been the capital flight. [...] Cryptocurrencies further democratize finance and enable capital flight for middle and low-income classes.”
The news comes a few months after some industry observers incorrectly speculated that Hong Kong’s launch of spot Bitcoin and Ether (ETH) exchange-traded funds (ETF) in April 2024 would open up the market for investors in mainland China.
According to local experts, the ETF issuers cannot provide such exposure despite having close ties with mainland China.
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