- There are ongoing projections that China might soften its stance on crypto.
- As a major economic and tech rival to the US, this move is now more feasible than ever.
The United States’ race to position itself as a global crypto hub has raised speculations about China relaxing its crypto ban. A potential digital asset revival in China will impact the global crypto market, creating new opportunities for investment and adoption across Asia.
Will China Compete With The US for Crypto Adoption?
Xiao Feng, the CEO and Chairman of Hong Kong-based HashKey Group, recently commented on China’s crypto policies. In an interview with the South China Morning Post, Feng stated that a shift in China’s crypto space is increasingly possible. The CEO sees establishing clear crypto regulation in the US as a major driver that could influence China’s position.
“If the US Congress and the [incoming]president make crypto policies clear, constantly legislate and promote the industry, it would certainly be a driving force for China to accept cryptocurrencies,” Feng noted.
Feng’s comments come amid a global crypto surge and renewed interest in digital assets across Asia following Donald Trump’s election win in the US. Spurred by Trump’s pro-crypto agenda, Bitcoin reached a record high above $93,000, and the global crypto market cap has recently surpassed $3 trillion.
Feng further stated that the US decision to sanction Russia following its Ukraine invasion may also contribute to convincing China to support the crypto industry. Due to the recent events, Feng claims China could now embrace crypto within two years instead of waiting five to six years.
So far, the Chinese government has made no sign of potentially lifting its ban on digital assets. However, Beijing has allowed Hong Kong to continue developing its digital-asset industry. China has maintained a hostile relationship with its digital currency industry since 2013, when it rolled out its first set of crypto restrictions. Chinese authorities consider this field a threat to financial stability and a breeding ground for criminal activity.
Voices Charging Revival in China’s Crypto Industry
Meanwhile, China recently introduced some economic initiatives like support for low-income citizens and increased debt issuance. These initiatives have added to speculations that the country’s attitude toward cryptocurrency may soften. Some analysts believe the combination of global economic shifts and U.S. influence could lead China toward a more flexible approach to crypto soon.
TRON’s founder, Justin Sun, has urged the People’s Republic of China to soften its cryptocurrency stance. According to a CNF report, Sun mentioned that China should follow in the US’ footsteps and accept Bitcoin. Similarly, Wang Yang, a Professor at Hong Kong University of Science, also questioned the rationale behind the decision to ban crypto mining.
Furthermore, former Chinese Vice Minister Zhu Guangyao recently emphasized the need to study crypto’s role in the digital economy. He pointed out shifting global crypto policies, particularly in the US, with the introduction of spot Bitcoin ETFs. However, he advised market participants to exercise caution to avoid risks like money laundering and terrorist financing.
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