Once Libertarian Dream, Bitcoin Is Now Chinese Currency
Chinese economic growth is a worry for many, having fallen below 7 per cent in the first quarter of 2016, which means that Chinese slowdown is the worst in the past six years. While the country’s all dominant central government is scrambling to shore up the economy by providing stimulus in whatever way it can, there is something going on in the cryptocurrency world that brings to fore Chinese domination of that field. Bitcoin for all intents and purposes now may be a Chinese currency.
From libertarian dream to a Chinese currency When it was conceived, Bitcoin was thought to be a libertarian dream.
As a unit of value it was not controlled by a central authority, it had to be mined like gold and it was pretty much thought to be inflation proof.
However fast forward to today and we live in a world where according to Bloomberg, China is ‘home’ to 90 per cent of bitcoin trades and 70 per cent of Bitcoin mining.
As the article reported, ‘Chinese miners have leveraged their access to cheap labor, inexpensive electricity and local chipmaking factories to outmaneuver their global peers in performing the complex calculations needed to verify Bitcoin transactions – a service for which they’re compensated in newly-minted bitcoin. When the cryptocurrency’s price tumbled from about $1,000 in late 2013 to below $200 in early 2015, lower costs in China allowed them to stay afloat even as many Western operators folded.’
This post was published at Coin Telegraph on 2016-07-14.