Why China’s love for the blockchain is bad for Bitcoin?

Last week the President of China XI Jinping delivered a speech in which called on the country to mass adoption of the blockchain. He noted that China should take first place in the development and use of decentralized technologies. On the background of positive news enthusiasts took to buy cryptocurrency. Immediately after that, the price of Bitcoin began to rise is a cryptocurrency demonstrated appreciation of approximately 30 percent in just a day.

This has happened a few times in the entire history of BTC. It would seem that all is well, because the new strategy of China should lead to a gradual increase in the price of the cryptocurrency in the future. However actually all not so is simple — the President’s speech may have a negative impact on the prospects of the industry.

China will hurt Bitcoin

It is worth noting that XI not a word is said about Bitcoin or cryptocurrencies in General. His thought was only of the technology itself, which lies at the basis of crypts. Given the high level of censorship and state control in China, the government has no incentive to support decentralised projects that could become an alternative to national currency of China.

It's true: yesterday in the daily newspaper Renmin Ribao, the official printed edition of the Central Committee of the Communist party of China, urged not to speculate on the topic of cryptocurrencies. That is, the country will indeed undertake the blockchain, but Bitcoin is irrelevant.

Source: CCN

Instead, the financial sector of the PRC focuses on DCEP — it is the name given to the centrally controlled digital currency, which is now the experts of the Central Bank of the country. Information about the DCEP has already been confirmed. The project is first going to test among several commercial banks of China — we wrote about this in our Telegram channel.

The government’s motives is clear: officials are going to use a blockchain to create its own currency, which can be fully controlled. In other words, ordinary Chinese do not expect financial freedom with DCEP. All their financial activities will be fully accessible to the relevant state authorities. And all this — in contrast to Bitcoin and other decentralized projects that the country’s leadership does not support.

Read also: In China, first adopted a law on bitcoin.

As soon as the DCEP is quite widespread throughout China, the government will “destroy the competition”. Any decentralized cryptocurrency will pose a threat to the national rate of China in the field of Finance. Already made some moves to tighten censorship in the country.

Source: Forbes

According to NewsBTC, China is also going to introduce a social system that will assess each citizen online and in real life. Perhaps DCEP will even use instant penalties for objectionable government actions. It’s not what you wanted to achieve Satoshi Nakamoto with their offspring.

Now, the Chinese authorities removed the local online article, called the blockchain fraud, that is, to actively support the policy of the President. Used to be the opposite: the same thing was done with publications that supported the technology. Obviously, after you run DCEP same fate may accrue and Bitcoin. The only question is, will have such propaganda in the country on reputation and the course of the first cryptocurrency in the world. Of course, negative.

At the moment Bitcoin is trading at 9124 dollars. For the past day, the value of the main cryptocurrency fell by 3.42 percent. The situation on the market follow our cryptodata millionaires!


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