Why did the central bank stop Bitcoin (why did the country rectify Bitcoin)

Why did the central bank call for the suspension of Bitcoin? Editor’s note: This article is from the vernacular blockchain (ID: hellobtc), authored by the Five Fireballs Cult, and reprinted by the Daily Planet with authorization Recently, the article “The Crash of Bitcoin Prices” was exposed and sparked heated discussions in the coin industry. According to media reports, the central bank has suspended Bitcoin, but this does not mean that the ban will have a significant impact on the entire industry. The decline in Bitcoin prices and the economic losses of Bitcoin mining and the benefits of other illegal activities both appear in the article So, why did the People’s Bank of China decide to stop Bitcoin trading? Why did the “Chinese version of Alipay”, “Ant Chain”, “eBay Finance” and other related applications also go online after this attack In fact, the central bank has already issued a notice that it wants to comprehensively clean up and shut down virtual currency business, and on June 21, it issued the “Risk Reminder on Preventing Illegal Fundraising in the Name of” Virtual Currency “and” Blockchain “. But since then, the domestic digital currency market has fallen into chaos. On the evening of October 16, 2020, Liu Luyao, Chairman of Beijing Financial Holding Group, said: “Recently, the regulators have paid more attention to the frequent occurrence of virtual currency speculation and Internet fraud.”, Punish criminals who commit Phone fraud severely; Starting from the end of 2020, all public exchange services between Bitcoin and Chinese yuan will be suspended. From the current perspective, these policy measures are all counterproductive, “responded the relevant person in charge of the central bank. Firstly, this announcement did not directly mention the development direction of digital asset trading platforms; Second, the Central Bank did not specify whether there were laws, regulations or technical standards related to virtual currency, but emphasized that it would take corresponding control measures to prevent the possible Systematic risk of virtual currency

Third, because the current Internet giants are actively laying out the Bitcoin ecosystem and trying to develop new digital currencies based on their own characteristics – Bitcoin and other crypto assets, the statement issued by the government department this time is not an official regulation to deal with the impact of the COVID-19 epidemic. Previously, the central bank has repeatedly emphasized that no unit or individual is allowed to engage in business related to encrypted assets, and cannot use legal representatives or key leaders to hold positions as senior executives or act as agents for daily business activities At the beginning of 2018, China’s central bank also proposed a viewpoint that the ability of the state to control currency circulation is a long-term development trend. However, when Bitcoin had not yet experienced extreme fluctuations like today’s, all countries were vigorously promoting the use of Fiat money as a payment tool, and they needed to meet certain conditions to continue to promote the internationalization process. In the middle of August 2019, Zhou Xiaochuan, the governor of the Central Bank, said publicly that with the change and development of the world economic situation, countries should treat digital currency more carefully

Why the country is rectifying Bitcoin

Editor’s note: This article is from HiveEcon (ID: HiveEcon), authored by Yuan Shang, and reprinted by Daily Planet with authorization The regulatory attitude of the country towards Bitcoin is very strict, and there have been many reports recently that the central bank has cleaned up and reorganized virtual currencies, but in reality, it has not had any substantial impact

This is mainly due to the following reasons:

1. Recently, some media and institutions have published negative news reports on blockchain technology and Cryptocurrency; 2. Some currency circle investors believe that “central bank digital currency” will bring financial risks; 3. Some domestic enterprises have financial security risks when conducting ICOs So what are these problems? Let’s analyze it below. 1、 In recent years, government departments in China have continuously increased their efforts to crack down on illegal mining activities at the policy level compared to the special currency mining industry. Starting from June last year, joint law enforcement actions have been launched nationwide against mining operations, gradually promoting an open source community autonomy system with a focus on combating money laundering and illegal criminal activities. At the same time, an organization specialized in Bitcoin mining activities, the Bitcoin Trading Management Unit (BCU), has also been established According to statistical data, as of the end of April 2019, since the official promulgation of the China Personal Information Protection Law (GDPR), more than 200 million pieces of internet content have been processed and recorded. From the end of 2020, the 254th Term of the Criminal Law of the China clearly stipulates that: “No unit or service provider shall illegally sell tokens to unlicensed Internet platforms or servers or other forms of acts that do not comply with the provisions of laws and regulations such as the Notice of the State Council on Preventing the Financing Risks of Token Issuance (Yin Fa [2013] No. 17) and are in violation of these Regulations shall be investigated for criminal responsibility.” II Relevant judicial authorities have actively used various means to maintain cyberspace order. Recently, the People’s Court has publicly pronounced a major fraud case involving the use of Bitcoin in accordance with the law. This case is the first time that the Supreme People’s Procuratorate has obtained and released evidence through investigation. It is understood that since 2019, the public security organs have arrested multiple individuals involved in fraud, and recovered a total of approximately 2 billion yuan in stolen funds. In mid May of this year, Mu Changchun, the director of the International Monetary Research Institute at Renmin University of China, said in an interview, “I have said many times that similar events can cause panic, but if measures are not taken in a timely manner, it will definitely attract widespread attention from society. And this special governance is a strong cooperation, on the one hand, it causes certain damage to the development of the industry, and on the other hand, it is also to prevent its further spread to other fields. This is a highly forward-looking strategic deployment, “he also said.” The anti monopoly situation in the entire country is now quite obvious, and there is an increasing emphasis on strengthening monitoring of the encryption field. “Thirdly, why is the country rectifying Bitcoin? In fact, as early as January this year, it was mentioned that although the official did not disclose specific punishment targets, it did provide its own explanation: “Currently, almost all projects are done according to the instructions of a certain company, such as a company either shorting Bitcoin or engaging in speculation, and then turning it into a high-yield thing