Fear Not, China Is Not Banning Cryptocurrency

In 2008 following the financial crisis, a paper entitled “Bitcoin: A Peer-to-Peer Electric Cash System” was posted, detailing the concepts of a payment system. Bitcoin was born. Bitcoin gained the interest of the world for its use of blockchain technology and as a substitute for fiat currencies and goods. Dubbed the next best technology after the internet, blockchain offered solutions to issues we have would not address, or overlooked within the last few decades. We will not explore the technical aspect of it but here are some articles and videos that I recommend: cryptominingfarm

How Bitcoin Works Under the Bonnet

A gentle introduction to blockchain technology

Ever question how Bitcoin (and other cryptocurrencies) actually work?

Quickly forward to today, sixth February to be exact, authorities in China have just unveiled a new set of regulations to ban cryptocurrency. The Oriental government have already done so this past year, but many have circumvented through overseas exchanges. It has now enlisted the almighty ‘Great Firewall of China’ to dam access to international exchanges in a put money to stop its individuals from carrying out any cryptocurrency transactions.

To know more about the Oriental government stance, let’s backtrack a couple years to 2013 when Bitcoin was gaining popularity among the Chinese citizens and prices were soaring. Focused on the price volatility and speculations, the People’s Bank of China and five other government ministries published the notice on December 2013 titled “Notice on Avoiding Financial Risk of Bitcoin” (Link is in Mandarin). Several points were outlined:

1. Because of various factors such as limited source, anonymity and lack of a centralized issuer, Bitcoin is not an established currency but an electronic commodity that cannot be employed in the open market.

installment payments on your All banks and financial organizations are not allowed to offer Bitcoin-related financial services or embark on trading activity related to Bitcoin.

3. All companies and websites that provide Bitcoin-related services are to register with the necessary government ministries.

4. Due to the anonymity and cross-border features of Bitcoin, organizations providing Bitcoin-related services ought to implement preventive measures such as KYC to prevent money laundering. Any shady activity including fraud, playing and money laundering should to be reported to the authorities.

5. Companies providing Bitcoin-related services must educate the public about Bitcoin and the technology to it and not mislead the public with misinformation.

In layman’s term, Bitcoin is categorized as a virtual commodity (e. g in-game credits, ) that can be purchased or bought from it is original form but not to be exchanged with fusca currency. It can not be identified as money- something that serves as a medium of exchange, an product of accounting, and a store valuable.

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