China’s central bank declares victory over Bitcoin • The Register

The People’s Bank of China, the country’s central bank, has announced its success in suppressing Bitcoin and online lending.

A WeChat post von der Bank outlined how it has spent the past five years implementing the wise leadership of China’s President Xi Jinping, with efforts that translate to “a comprehensive purge and correction of the financial order.”

Among achievements in this area, the bank claims that it has continued to crack down on domestic speculation in virtual currency trading. These efforts resulted in “China’s domestic bitcoin trading volume falling significantly around the world.”

It is unclear whether the lack of mention of cryptocurrency mining is an artifact of machine translation or an intentional choice of words.

But a sentence claiming, “The special correction of Internet financial risks has been successfully completed, and nearly 5,000 P2P online lending institutions have been closed,” has a clear meaning. China dislikes peer-to-peer lending because it is seen as too difficult to regulate and therefore a risk to the economy. Which is the main reason Beijing has canceled the IPO of Alibaba’s financial services company Ant Groupthat enabled P2P lending online.

The Xi-led government has since placed much emphasis on bringing all of China’s big tech companies under control so that their innovation and growth serve the nation rather than lead to a concentration of market power. Beijing is also keen to ensure that prominent CEOs do not achieve fame and prestige that rivals that of senior officials – such as Xi.

The timing of the bank’s contribution can be as important as its content. It comes before the start of the 20th National Congress of the Chinese Communist Party on October 16.

At the event, Xi is expected to be reappointed to an unprecedented third term as China’s president. No other Chinese leader — not even Mao Zedong — has served longer than Xi, and if appointed for a third term, he may lead the nation five years longer than any predecessor.

The bench’s post therefore serves to remind the nation of Xi’s track record and the effectiveness of his policies.

But the post also offers a rosy outlook: only last week authorities reported the arrest of 93 people accused of using virtual currency to launder $5.5 billion.

The activities of this group reflect the fact that China has done this tried to ban the mining and use of cryptocurrencies for years, but has felt the need to restate the ban often. Even after years of edicts making it clear that crypto is not welcome, Chinese courts have reigns Crypto coins can be viewed as an asset.

Crypto may therefore be officially under control in China, but the reality appears to be different. And Xi is likely to be reappointed anyway. ® China’s central bank declares victory over Bitcoin • The Register

Laura Coffey

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