Bitcoin (CRYPTO: BTC) and other cryptocurrencies “are not legal tenders and have no actual value support,” according to Deputy Director of the Financial Consumer Rights Protection Bureau of the People’s Bank of China (PBoC) Yin Youping.
What Happened: According to a report by local news outlet People’s Daily Online, Youping said that cryptocurrencies are purely speculative assets. He also advised the public to increase its risk awareness and stay away from the crypto market to “protect their pockets.”
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The PBoC official also said in anticipation of the possible crypto market rebound and their related operations in China, the central bank will monitor overseas cryptocurrency exchanges and domestic traders in collaboration with relevant authorities.
What Else: The institution also plans to crack down on the space by blocking crypto trading websites, applications, and corporate channels.
Per the report, PBoC — being a member of the Joint Conference to Deal with Illegal Fund Raising — actively cooperates with the lead department of the China Banking and Insurance Regulatory Commission.
As a result of this collaboration, the regulator created systems aiming for the monitoring, early warning, publicity, education, and overall combating of illegal fundraising powered by cryptocurrencies and blockchains.
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Youping explained that PBoC’s next step will be establishing a normalized working mechanism, continue putting high pressure on illegal cryptocurrency-related operations, and continue cracking down on crypto-related transactions.
Lastly, the report intimates that “if the general public finds clues about illegal fund-raising crimes, they must promptly report to the relevant departments.”
China’s crackdown on cryptocurrencies will probably intensify and may even lead to an outright ban on holding the tokens, according to Bobby Lee, one of the country’s first Bitcoin moguls.
Lee knows what it’s like to be on the wrong side of Beijing: He sold BTC China, the nation’s first Bitcoin exchange and at one point the second biggest worldwide, in the aftermath of a crackdown in 2017.
China has launched a new campaign against cryptocurrencies this year, taking action against miners and imposing curbs on crypto banking services and trading. The moves have fueled Bitcoin’s drop to about half its mid-April record near $65,000.
“The next thing they could do, the final straw, would be something like banning cryptocurrency altogether,” Lee said in an interview at his office in a WeWork space in downtown Shanghai, without elaborating on how a ban might be enforced. “I put it at the odds of 50-50.”
Lee recently returned to China after spending time in the U.S. and publishing a book, “The Promise of Bitcoin.” He’s now focused on his latest venture, Ballet Global Inc., which produces a hardware wallet that stores cryptocurrencies. Lee is still a Bitcoin bull, predicting it could end this year around $250,000 and reach $1 million by 2025. He declined to disclose his Bitcoin holdings.
Next year will be a bear market cycle. So we’ll see Bitcoin fall back down 50%-80% from the all-time high. I think Bitcoin will have its bull cycle every three or four years in the coming years. I expect Bitcoin to pass a million, two million dollars easily in the next 10-15 years. In fact the next cycle I predict to be in the year 2024 or 2025, and that’s when Bitcoin will cross half a million dollars and might even touch $1 million.