China Is Manipulating Bitcoin
China Is Manipulating Bitcoin: What Does This Mean for Cryptocurrency?
China has a serious love-hate relationship with the digital world. On one hand, it’s home to the infamous Great Firewall, an elaborate network of censors that block anything and everything that the authoritarian Communist Party deems unfit for its citizens. But on the other, it’s also become a hotbed for digital innovation over the last few years, with blockchain at the forefront. It seems as if China can’t make up its mind about how to feel about virtual currencies. Even so, there are reasons to be worried about what China is doing to manipulate cryptocurrency at this moment in time – and investors need to know why. China continues to tighten its grip on domestic crypto markets while simultaneously cracking down on international exchanges and apps. This has left many worrying about what implications this will have on global marketplaces going forward.
Blockchains and cryptocurrency should be embraced
China has been making headlines for all the wrong reasons when it comes to cryptocurrency. The country is keen to control the market in every way possible, be it mining, trading, or investing. However, what people don’t realize is that this is actually stifling blockchain development in the long run. Chinese authorities are keeping people from making their own economic choices when it comes to virtual currencies. They’re also keeping them from owning a piece of the future in blockchain, a technology that can be used for so much more than just virtual currencies.
Why is China manipulating Bitcoin?
China is a big player in the global cryptocurrency market, so it’s hardly surprising that it manipulates Bitcoin. But why exactly is it doing so? There are a few theories regarding why China is manipulating Bitcoin. The first theory is that the government is trying to capitalize on the exponential increase in Bitcoin value, in order to solidify its status as a global economy. China has been experiencing a significant economic slowdown, with growth rates dropping to their lowest levels in decades. The government has been trying to pivot towards a more export-heavy economy, so taking advantage of Bitcoin’s rising value could be a strategic way to do so. The second theory is that Chinese authorities are trying to prevent a massive economic crisis fueled by inflation and capital flight.
Cryptocurrency poses a threat to the central bank
The Chinese government wants full control of its economy. This includes the financial sector and the general flow of capital. Any form of currency that isn’t under the control of the central bank poses a threat to this authority. Virtual currencies are the epitome of decentralized systems in which no one entity has control. China has been trying to eliminate cryptocurrency mining within its borders for years, and it has been shutting down domestic exchanges for just as long. The government has even gone as far as blocking access to international exchanges, which is what’s causing all this manipulation in the first place. Basically, Chinese authorities have been so successful at manipulating cryptocurrency that there’s almost no crypto left in China. However, this has caused a global drop in the value of virtual currencies, which is bad news for investors. It also means that Chinese authorities can’t manipulate them anymore.
International oversight of domestic markets is key
As mentioned above, Chinese authorities are blocking access to international exchanges, which has led to internal manipulation. However, there are also reports that authorities are now allowing access to some of the largest worldwide exchanges, including Coinbase and Binance. The Chinese government has always been loath to relinquish control of anything. So it’s commendable that it’s allowing international oversight of domestic markets, even though it is clearly manipulating Bitcoin. However, by doing so, the government is increasing the likelihood of regulation and increased oversight of the crypto market. This is bad news for crypto investors, but it could be the only thing that prevents the value of Bitcoin from dropping even further.
Bitcoin is facing some serious manipulation from Chinese authorities. The country is closing access to international exchanges and apps, and there are reports that it is blocking access to mining pools, too. This has caused a significant drop in the value of Bitcoin, but it could also lead to increased regulation of the cryptocurrency market. However, this doesn’t change the fact that blockchain technology is the future. It’s too important to be ignored or shut down by governments. And it’s too important to be manipulated by just one country. It’s easy to panic when something like this happens, but people need to remember that this is a bump in the road. And there’s no better time to invest in cryptocurrency than when the price is low.