Chinas Crypto Industry Lives On. Here Are 3 Quotes About Its Current State

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Ban or no ban, Chinas crypto obsession is as strong as ever. Before the government stomped into the cryptocurrency industry, China was arguably the worlds leader. Its exchanges were the biggest and, at its heights, they controlled 70% of bitcoins hashrate. The ban was supposed to kill all that, but the roots were too strong. In Bloombergs recent Inside China’s Crypto Scene, a Year After Sweeping Crackdown, we learn where China’s crypto industry currently stands.

The article cleverly compares the ban to Chinas decision in the 1990s to erect the Great Firewall, which gave the CCP unprecedented power to restrict the free flow of information. Apparently, Bloomberg did the work. They claim the article is based on Interviews with more than a dozen industry participants based in China, ranging from founders to programmers and operations specialists, paint a picture of a sector trying to find its path by experimenting with new products and services in the hope that regulators wont crack down.

Read the whole thing if you want a comprehensive picture of the current situation. We will focus on the quotes. On the protagonists reports from the grounds.

Three Quotes That Speak Volumes

Hes the founder of Folius Ventures, an investment fund focused on Asian crypto startups. Jason Kam clues us in on the current state of Chinas crypto development scene:

At its core, the Chinese government is going to dampen speculation and capital outflow, but for the remainder of web3, such as developers writing code, the government has a one eye open, one eye closed approach.

Shes Chainalysis director of research. Kim Grauer explains a billion-dollar market for Chinas crypto industry to tackle:

There are informal crypto markets that are operating in kind of a legal gray area. Weve talked with merchants who are in Sub-Saharan Africa and Latin America who are purchasing goods from China, using cryptocurrency in this informal market capacity. We can see people within China are still visiting major centralized exchanges.

Hes the mind behind the Strxngers NFT collection. The pieces resemble pixellated 80s-style computer game avatars and sold out in less than a minute. Its creator, Frank Chen, explains the reasoning behind the project:

I picked NFT as an area to experiment within China because I dont think the country is completely against it. Before any regulation on digital collectibles comes out, there is currently a gray area that allows people to experiment.

Thats an insider’s view of Chinas crypto industry as it stands today. What about tomorrow, though?

BTC price chart for 10/24/2022 on Bitstamp | Source: BTC/USD on TradingView.com Chinas Crypto Solution

Scarily, the country’s crypto future looks like permission-based blockchains under state oversight. And the first iterations of that technology are already up and running in the Asian continent. Crypto is about trading and applications, and we are all about the tech infrastructure. Two entirely different worlds, said Red Date Technologies He Yifan. What does his company’s product look like?

Unlike on a traditional blockchain like Ethereum, transaction costs are denominated in fiat currency and fixed at 0.05 yuan per transaction. Daily transactions on Red Dates Blockchain-based Service Network have surged to over 1 million, according to He, comparable with volumes on Ethereum.

Is this another way of realizing the promises of blockchain technology or is Chinas crypto environment so toxic that they already ruined their part in the play without even knowing? Time will tell, but the whole situation is certainly exciting and surprising. Most people thought that the ban would kill Chinas crypto industry, but look at them now. The party is just getting started.

Featured Image | Charts by TradingView

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