I've heard that chinese people when going abroad for some work to countries, where they can't use their local payment systems, are transfering money back to china in Bitcoins. So right now it seems like the system started to work in the opposite direction and wealthy people started to transfer their money out of the country.
The other point is that China is authoritarian enough country in order not to hide their true goals.
Topic: China's Proposal To Ban Cryptocurrency Mining Has Little To Do With Environment - page 2. (Read 289 times)
May 01, 2019, 05:05:26 AM
May 01, 2019, 04:21:22 AM
Yep, it is laughable for a country that produces most of its electricity from the dirty coal power. It never about the environment, but about capital flight. The Chinese government is known for facilitates capital inflows, and at the same time blocking the capital outflows.
Absolutely ridiculous. Do these people even know how badly they are harming nature? They are one of the primary reasons behind global warming and yet all they care about is money and nothing else.These governments need to get their shit together and understand that our planet is a billion times more valuable than money.
May 01, 2019, 04:14:49 AM
Yep, it is laughable for a country that produces most of its electricity from the dirty coal power. It never about the environment, but about capital flight. The Chinese government is known for facilitates capital inflows, and at the same time blocking the capital outflows.
April 30, 2019, 12:41:35 PM
What's the consensus on china's motivation for proposing to ban crypto mining?
Capital flight has always been a top candidate for china's crypto crackdowns. Preventing liquidity and wealthy residents contained inside china's borders from moving out of the country. Like china, both NY and california contain a high percentage of residents who wish to migrate out of state and live elsewhere--taking their wealth with them. In this we might draw parallels between them.
It's entirely about capital flight. As long as there are Chinese miners, there are people willing to sell bitcoins over-the-counter or in person to very rich Chinese people who want to get their money out of the country.
And as it's being done in person or over-the-counter, they can't trace it or track who is buying, especially if the buyer exchanges cash for their coins. The only way to stop it is to ban mining, so people within China don't have access to the coins at all.
Totally agree, been reading a lot of articles about this and it seems the main reason for them banning crypto mining in their jurisdiction is because of this. They don't want their wealth going outside their country thru crypto-mining and over-the-counter transactions. Environmental issues has always been a minor issue to China. It will always be about wealth distribution.
April 30, 2019, 11:38:25 AM
What's the consensus on china's motivation for proposing to ban crypto mining?
Capital flight has always been a top candidate for china's crypto crackdowns. Preventing liquidity and wealthy residents contained inside china's borders from moving out of the country. Like china, both NY and california contain a high percentage of residents who wish to migrate out of state and live elsewhere--taking their wealth with them. In this we might draw parallels between them.
It's entirely about capital flight. As long as there are Chinese miners, there are people willing to sell bitcoins over-the-counter or in person to very rich Chinese people who want to get their money out of the country.
And as it's being done in person or over-the-counter, they can't trace it or track who is buying, especially if the buyer exchanges cash for their coins. The only way to stop it is to ban mining, so people within China don't have access to the coins at all.
April 30, 2019, 11:25:59 AM
Quote
Recently, the National Development Reform Commission, China's top economic planning body, proposed banning all cryptocurrency miners within its borders. China has banned initial coin offerings since 2017 and made it harder for domestic citizens to transact on cryptocurrency exchanges by banning them domestically. It is clear that the Chinese state is not a fan of permissionless blockchains and cryptocurrencies built on top of them. The rationale was posted in a listed of industries the Commission was looking to eliminate because they seriously "wasted resources" or damaged the environment.
This has massive implications for the cryptocurrency ecosystem. Nature did an analysis that shows that three-quarters of cryptocurrency miners are based in China. With cheap computing power, hardware and reasonably cheap electricity and a strong pool of people who were incentivized by the level of profit that could be made, many of the miners who are dedicating their computing power to validating blocks on Bitcoin, Ethereum and other cryptocurrencies did most of their mining in China and were compliant with Chinese laws. Many miners have subsequently gone on to Iran and other jurisdictions, but found many of the same restraints that had led them to leave China, with their mining rigs banned at the border, or with unscrupulous players looking for a share of their profits.
Does any of this have much to do with the environment?
No, and a simple fact belies that truth.
While the Chinese state has made an effort to address environmental and energy concerns, tagging cryptocurrency mining as wasteful doesn't make sense when you consider the blockchain pilots the Chinese government is running as well.
The Central Bank in China (the PBOC or the People's Bank of China) is racing to do trials of its own version of centralized blockchain currency and has completed one already on a permissioned blockchain along with several other major commercial banks. The central bank was one of the first in 2014 to start unleashing pilot studies towards the first digital central currency and in 2016 put out a call for blockchain and cryptocurrency experts in order to learn more about the field. It's clear that the central bank in China (which unlike other many other central banks, is not nominally independent from political pressure) is moving to adopt blockchain in some capacity, and is at the forefront of monetary authorities studying blockchain.
The Communist Party of China doesn't think that blockchain and its useful properties (from traceability of transactions to immutability) are a waste or environmentally damaging when it comes under their control. It's not the technology that is being decried as wasteful, but rather the distribution of power from centralized state to decentralized miners.
In fact, it's not hard to see how a currency that traces every transaction throughout the country and is able to build a complex map of relationships between different people might then feed into the very many different ways the Chinese government traces data and uses it to rank its citizens: everything from the Social Credit score to facial recognition for jaywalking. The energy output of creating this massive ongoing surveillance apparatus much outweighs printing physical paper copies of currency once -- but it's not deemed useless because it is politically useful.
China has capital controls in place in order to keep the domestic currency (the Yuan) and domestic stock indexes stable. The country is also very watchful for economic elites trying to bring money out of the country, with 60% of them expressing an interest in emigrating out. It is of critical concern to the Chinese state to keep capital within its borders and in its control. In that respect, it can be easy to see how public, permissionless cryptocurrencies would counteract that goal.
The cryptocurrency mining ban China proposes has little to do with environmental waste: the surveillance system the Chinese state is trying to build on top of its every citizen, a system that seeks to ingest monetary information, transactions, and every communication would consume infinitely more power than their analog equivalents.
This move has much more to do with control: who has control over the blockchain in use and capital flows within and without China. Paradoxically, with the centralization of mining pools in China becoming a concern when it came to consolidation of network hash rate (60-70% of Bitcoin's network hash power was contained in China), China's proposed ban on cryptocurrency miners, if it comes to pass, may actually strengthen blockchains, Bitcoin and other cryptocurrencies in the long run.
https://www.forbes.com/sites/rogerhuang/2019/04/25/chinas-move-to-ban-cryptocurrency-mining-has-little-to-do-with-the-environment/
This has massive implications for the cryptocurrency ecosystem. Nature did an analysis that shows that three-quarters of cryptocurrency miners are based in China. With cheap computing power, hardware and reasonably cheap electricity and a strong pool of people who were incentivized by the level of profit that could be made, many of the miners who are dedicating their computing power to validating blocks on Bitcoin, Ethereum and other cryptocurrencies did most of their mining in China and were compliant with Chinese laws. Many miners have subsequently gone on to Iran and other jurisdictions, but found many of the same restraints that had led them to leave China, with their mining rigs banned at the border, or with unscrupulous players looking for a share of their profits.
Does any of this have much to do with the environment?
No, and a simple fact belies that truth.
While the Chinese state has made an effort to address environmental and energy concerns, tagging cryptocurrency mining as wasteful doesn't make sense when you consider the blockchain pilots the Chinese government is running as well.
The Central Bank in China (the PBOC or the People's Bank of China) is racing to do trials of its own version of centralized blockchain currency and has completed one already on a permissioned blockchain along with several other major commercial banks. The central bank was one of the first in 2014 to start unleashing pilot studies towards the first digital central currency and in 2016 put out a call for blockchain and cryptocurrency experts in order to learn more about the field. It's clear that the central bank in China (which unlike other many other central banks, is not nominally independent from political pressure) is moving to adopt blockchain in some capacity, and is at the forefront of monetary authorities studying blockchain.
The Communist Party of China doesn't think that blockchain and its useful properties (from traceability of transactions to immutability) are a waste or environmentally damaging when it comes under their control. It's not the technology that is being decried as wasteful, but rather the distribution of power from centralized state to decentralized miners.
In fact, it's not hard to see how a currency that traces every transaction throughout the country and is able to build a complex map of relationships between different people might then feed into the very many different ways the Chinese government traces data and uses it to rank its citizens: everything from the Social Credit score to facial recognition for jaywalking. The energy output of creating this massive ongoing surveillance apparatus much outweighs printing physical paper copies of currency once -- but it's not deemed useless because it is politically useful.
China has capital controls in place in order to keep the domestic currency (the Yuan) and domestic stock indexes stable. The country is also very watchful for economic elites trying to bring money out of the country, with 60% of them expressing an interest in emigrating out. It is of critical concern to the Chinese state to keep capital within its borders and in its control. In that respect, it can be easy to see how public, permissionless cryptocurrencies would counteract that goal.
The cryptocurrency mining ban China proposes has little to do with environmental waste: the surveillance system the Chinese state is trying to build on top of its every citizen, a system that seeks to ingest monetary information, transactions, and every communication would consume infinitely more power than their analog equivalents.
This move has much more to do with control: who has control over the blockchain in use and capital flows within and without China. Paradoxically, with the centralization of mining pools in China becoming a concern when it came to consolidation of network hash rate (60-70% of Bitcoin's network hash power was contained in China), China's proposed ban on cryptocurrency miners, if it comes to pass, may actually strengthen blockchains, Bitcoin and other cryptocurrencies in the long run.
https://www.forbes.com/sites/rogerhuang/2019/04/25/chinas-move-to-ban-cryptocurrency-mining-has-little-to-do-with-the-environment/
....
What's the consensus on china's motivation for proposing to ban crypto mining?
Capital flight has always been a top candidate for china's crypto crackdowns. Preventing liquidity and wealthy residents contained inside china's borders from moving out of the country. Like china, both NY and california contain a high percentage of residents who wish to migrate out of state and live elsewhere--taking their wealth with them. In this we might draw parallels between them.
Environmental concern is a newer angle. China currently hosts 14 out of the top 30 most polluted cities on earth. Despite high pollution in parts of the country they continue to construct new coal power plants which will inevitably contribute to even greater quantities of pollution. Bitcoin mining being extremely mobile and often tapping underutilized and therefore: cheaper sources of electricity does somewhat rule out the climate change angle.
Do we have other prime candidates with potential to explain a motive behind this?
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