China’s Latest Move May Have Shattered Bitcoin Investors’ Dreams

• The recent changes at the People’s Bank of China (PBOC) have dashed hopes for a possible relaxation of China’s digital asset trading since September 2021.
• PBOC has not made any statements regarding Pan’s views on existing cryptocurrencies or the future of China’s digital asset ban.
• Senior officials outside the central bank also express doubts about Bitcoin and emphasize the government’s focus on developing the digital yuan.

The recent cryptocurrency developments in Hong Kong, which is affiliated with China, briefly revived the community’s hopes, but it didn’t last long; China appointed an anti-Bitcoin politician to the PBOC.

Newly Appointed Figure at PBOC Turns Out to Be Anti-Bitcoin

The recent changes at the People’s Bank of China (PBOC) have dashed hopes for a possible relaxation of China’s digital asset trading since September 2021. Speculations arose when Beijing showed support for Hong Kong’s attempt to become a cryptocurrency hub. However, the appointment of Pan Gongsheng, a leading Communist Party official, as the Communist Party Secretary at PBOC demonstrates the commitment to policy continuity.

Pan’s previous statements during a previous cryptocurrency regulation, including his declaration about the end of Bitcoin, have resurfaced with his new appointment. Pan Gongsheng’s words in 2017;

“If you sit by the river and watch, one day the corpse of Bitcoin will float in front of you.”

However, PBOC has not made any statements regarding Pan’s views on existing cryptocurrencies or the future of China’s digital asset ban. Last year, China Economic Daily, the spokesperson for the Communist Party of China, hinted at the possibility of stricter regulations on digital collectibles or NFTs.

Experts like Bloomberg economist David Qu argue that Pan’s appointment highlights PBOC’s determined stance against Bitcoin. Qu states that PBOC secretaries have never supported Bitcoin throughout history and considers the developments in Hong Kong insignificant as it is perceived as a foreign market by mainland China.

In addition, senior officials outside the central bank express doubts about Bitcoin and emphasize the government’s focus on developing the digital yuan. Last year, a significant step was taken with the beta version of the digital yuan, officially releasing the digital yuan application for iOS and Android in Chinese app stores.

Cryptocurrencies in China

Although there have been some cryptocurrency stories suggesting that China’s ban will ease with Hong Kong’s return to being crypto-friendly, industry figures like Justin Sun and Changpeng Zhao face challenges in the United States. They indicate a shift towards more crypto-friendly regions globally but caution against expecting an immediate relaxation of the ban in mainland China.

Beijing’s concerns about money laundering, environmental impact, and capital outflows have led to strict control measures on cryptocurrencies. In May, CZ positively shared that China Central Television (CCTV), a national television broadcaster, aired cryptocurrencies.

Currently, Bitcoin is steadily trading at $30,670 and showing an 85% increase in 2023, while Ethereum is moving towards the $2,000 level. The crypto market will closely monitor any future developments in China’s regulatory stance under Pan’s leadership at PBOC.