Thread by @adrianhetman

1/ Why China is cracking down on #Bitcoin? 🧵

Currently many of the Chinese provinces where Bitcoin miners resided, rolled out new policies restricting or banning the #BTC miners.

Inner Mongolia, Xinjiang, Yunnan and Sichuan banned Bitcoin.

2/ Energy companies were told to stop providing energy to crypto miners due to them using too much electricity.

It became an illegal activity to mine cryptocurrencies. If someone would be found to do so regardless, they would be added to the blacklist of social credit system.

3/ All decision seems to be linked mainly with Energy usage.

China plans to achieve carbon neutrality by 2060 and reducing carbon intensity or the amount of carbon emitted per unit of GDP, by more than 65% by 2030.

Bitcoin mining ban can help with that.

4/ But it doesn’t stop at this. Another hidden agenda is the launch of their of CBDC, Digital Yuan.

Bitcoin represent a different approach to what CCP wants to offer with its digital RMB.

What first, what is a CBDC?

5/ CBDC is a digital equivalent of a physical currency that is:

* secure
* unique - each token issued by the Government will have a unique identifier similar to banknotes
* Will come without the same friction of printing, storing, and moving physical money around a country.

6/ That's one of the reasons why China is interested in this.

They would have control of all the money flow that is happening in the country and also globally.

Digital Yuan or DCEP is a massive project that will only grow in size and reach.

7/ Having competition in any form of "traditional" cryptocurrency will only slow down their impact.

Hence we see ban of #Bitcoin and #bitcoinmining.

China is making more room for its solution to control and impose any restrictions as they want.

adrianhetman.com/chinas-crackdo…

8/ With DCEP, China could monitor every transaction and integrate it with its social credit system.

Imagine getting a speeding ticket and your SCS being affected immediately and fine collected at the spot by the system.

More on SCS, here: scmp.com/economy/china-…

9/ Another reason is the fact, China wants to become independent of the U.S. dollar.

💵 is the backbone of world financial systems.

China is working on two front to change that.

1. They’re cooperating with Russia to ditch Dollar and move towards the economic alliance.

2. 👇

10/ 2. Pan-Asian alliance to create a cross-border digital currency which will consist of

1. Chinese yuan
2. Japanese yen
3. South Korean won
4. Hong Kong dollar

It will foster free trade agreement between these countries, while reducing 💸 dominance.

11/ Having its own CBDC, China will push for its DCEP to be the primary coin of such trades between these countries, strengthening its currency.

That’s why it’s more than just a ban on #Bitcoin . It’s a long-term plan for China dominance in digital/financial space.

12/ TLDR:

1. China #BTC ban is more than it looks
2. It wants to reduce its carbon footprint
3. Make room for digital yuan
4. Digital RMB falls nicely into China Social Credit Score
5. China wants to become independent of U.S. Dollar and digital RMB will help with that.

I wrote also multiple article that delves into this subject. If you want to check them out, I link them below.

adrianhetman.com/will-digital-y…

adrianhetman.com/does-china-pre…

#cryptocurrencies #CryptoTwitter #bitcoinnews #CryptoNews