China has been increasing its regulatory pressure on crypto firms to help Chinese citizens stay clear of high-risk investments.
Bitcoin (BTC) maximalist and Ballet CEO Bobby Lee recently discussed the implications of China’s ongoing crackdown on cryptocurrency. Despite the government’s support for a digital renminbi, Lee suggested that Beijing has no interest in nurturing the cryptocurrency industry.
Considering his collisions with the Chinese government during his stint in running China’s first crypto exchange BTCChina, Lee said:
“It (China) wants to regulate (cryptocurrencies) to achieve its overarching goal of globalization of digital RMB.”
He further stated that the Chinese government is not looking after the vast crypto exosystem that exists in the region. Stressing on the wait-and-see approach, Lee highlighted that 2017 marked the start of increased regulatory scrutiny, and at this pace, “I do fear that in 4-5 years, the country might outright ban it (cryptocurrency).”
The government’s recent ban on crypto mining and related trading seems to be aimed at deterring citizens from getting heavily involved in high-risk investments given the boom in trading volumes. Adding to this thought, Lee said:
“Bitcoin is not a direct competition to the digital yuan. I don’t think that the cryptocurrency industry will suffer from China’s pullback.”
Bitcoin’s decentralized global network has led Lee to believe that China’s stance in accepting or banning cryptocurrency will not affect the Bitcoin or crypto market in the long run. To help viewers make sense of Elon Musk’s recent move towards Bitcoin adoption at Tesla, the seasoned entrepreneur hopes to see more Fortune 500 companies in 2021 add more Bitcoin and cryptocurrency holdings to their current portfolio.
Lee believes that the final straw at this moment would be banning cryptocurrency and Bitcoin altogether. But considering the involvement of mainstream businesses along with ever-increasing government initiatives, China continues to restrict its in-house crypto business operations while allowing individuals to hold and trade Bitcoin.
Related: FTX reduces max leverage from 101x to 20x to encourage ‘responsible trading’
Owing to China’s recent crypto regulations against risky trading, crypto businesses have started taking proactive steps to stay relevant in the ecosystem. As per CT’s recent report related to this development, FTX announced to limit its trading leverage to 20x, which was previously standing at 101x.