Has the Crackdown on Chinese Bitcoin Miners Turned Investors Away?Scroll Down
Despite increased pressure by financial regulators who heed the wishes of the Communist Party of China, Bitcoin investors have managed to prevail by means of stoic reactions. Most of the regulatory actions reported by financial news outlets was limited to Bitcoin miners who were run out of town by Chinese officials, but there were other developments that made the intentions of the Communist Party very clear.
With every passing day, the political landscape of China is changing. Beijing's actions and reactions are changing. Beijing's political and regulatory climate is changing. The Bitcoin market is changing. When Bitcoin traders wanted to enter the Chinese market, they were able to find miners at different stages of operation. These investors did not fully consider the level of risk when deciding whether to participate in the mining industry by means of staking.
The miners usually buy Bitcoin mining equipment from China's local partners in order to mine blocks that were profitable to them. This is how the miners used to make money, and the local partnerships helped foreign miners to obtain a Chinese work permit in the country. There was also the matter of cheap electricity, and that explains why some mining pools moved across the border to Kazakhstan.
The Communist Party has not been shy to explain what its high-profile members really want, which is to dominate in terms of blockchain development so that they can increase the value and circulation of the digital yuan. This is why China has blocked cryptocurrency exchanges from coming up as web query results. Chinese bank accounts that handled Bitcoin exchanges into stablecoin tokens have been ordered to shut down.
When a group of foreign people came together and started mining Bitcoin, they were mainly Chinese nationals. In terms of market volume, that kind of operation had a massive impact on China's cryptocurrency mining sector. Even in a market that is saturated by China's native miners, the influence of the foreign miners cannot be ignored. China's local partners may have started to feel uncomfortable. Despite all these concerted attacks, Chinese nationals are using proxies and other solutions to access their digital wallets, and they are also reaching out to trusted contacts across Asia to help them trade digital currencies.