Bitcoin has aroused a situation of boom and bust in the marketplace. From millennials to savvy investors, bitcoin is present in the portfolio of almost every investor. Bitcoin is a fascinating and elating investment asset having a considerable store value. The store value of bitcoin nears $67K.
However, bitcoin’s inventor did not invent bitcoin as an investment asset; he mentioned bitcoin as an electronic payment system having a complete peer-to-peer network. Therefore, he was not familiar with the idea that bitcoin will acquire this amount of store value in the future.
Bitcoin mining and trading are correspondingly helping people to make a considerable amount of money just by sitting at their homes. You can check websites like https://bitiq.org/ to make your bitcoin trading venture much more robust and productive. China is the largest cryptocurrency market as Chinese miners contributed almost 65% to the global bitcoin mining chain.
Regardless of such facts, China recently announced a cryptocurrency crackdown in the country. Below is an utter portion demonstrating the decisive reasons behind the cryptocurrency crackdown in China.
What was the China Bitcoin Ban?
Every crypto enthusiast is familiar with the fact that China recently announced a cryptocurrency crash in the country. According to the joint committee of china, no institution can accept bitcoin payments; all the more, no financial institution can offer cryptocurrency services to any new customers.
Recently the People’s Bank of China announced that all crypto transactions are illegal. So, bitcoin trading and investment progression and higher authorities have correspondingly announced a ban on bitcoin mining.
Why did China Ban Bitcoin?
Cryptocurrencies are decentralized, and there are no government authorities or higher authorities to control these cryptocurrencies. However, due to decentralization aspects, some prominent cryptocurrencies like bitcoin and ethereum are exceedingly volatile. The volatility of bitcoin leads to some financial risks as per the higher authorities of china. Therefore, China banned bitcoin from stabilizing the economic part of the country.
All the more, China recently announced the first-ever centralized cryptocurrency Yuan. China banned cryptocurrencies from making people know about Yuan. Thus, China is the first-ever country to release a centralized cryptocurrency. Yuan correspondingly underlies the similar mechanism as of bitcoin, but the dynamics of Yuan are much different.
As mentioned ahead, China was the hub of bitcoin mining. Chinese miners contributed more than 64% of the hash rate in the global bitcoin mining chain.
However, bitcoin miners of china merely used electricity as the energy source. The prominent reason behind this fact is that electricity is much cheaper and conveniently accessible in china.
The extraordinary electricity consumption in China due to bitcoin mining was affecting the environment to an exceeding extent as per the rich sources. After the cryptocurrency mining ban in China, Chinese miners are migrating to other countries such as Texas, Kazakhstan, and a few others.
The electricity consumption of bitcoin mining generates tons of e-waste, and china was the leading contributor in this progression. The fact might amaze you that a single bitcoin transaction produces e-waste of 272 grams which contains multiple gas and toxins. The president of china planned a carbon natural china by the end of 2060, and bitcoin mining was interrupting this plan.
Has China banned bitcoin ever before?
Bitcoin mining ban in China suspended vast bitcoin mining pools and mining plants in china. Provinces in China have embraced a crackdown in the country. Several provinces are shutting bitcoin mining operations in their locality. The fact might amaze you that bitcoin mining was earlier legal in some regions of China. However, after the intensification of cryptocurrency crackdown, no institution can do bitcoin mining.
China banned bitcoin trading and investing from trustable regional exchanges way before 2019. However, crypto investors from china were still performing these activities with the help of trustable international exchange.
Recently the national bank of china announced that no cryptocurrency transaction is legal. So, in a nutshell, now bitcoin trading and investing in bitcoin is illegal in the country. But no government authorities have clarified the punishment or any jail terms in the country.
The above mentioned are some of the potential reasons why China announced a cryptocurrency crackdown in the country.