The Central Bank of China has ordered the shutdown of an alleged software company given its reported ties to crypto mining. Beijing Qudao Cultural Development has been suspended at the time of writing and must cease all operations or face legal consequences from the bank’s regulators. Its website has also been deactivated.
China Shuts Down Software Company
China has always had a rather mixed relationship with bitcoin and cryptocurrencies. In the past, the country has ended crypto exchanges and initial coin offerings (ICOs), though the alleged bitcoin hate that the country feels is taking on entirely new form. The nation is now working its behind off to end all crypto mining operations within its borders, which in the long run, could potentially cause economic problems for China.
As it stands, China is host to approximately 65 to 75 percent of the world’s cryptocurrency mining firms. It is also home to Bitmain and Canaan Creative, two of the biggest manufacturers of cryptocurrency mining equipment. Why then, with all this business and all this money to be made, would China take such reprehensible action against bitcoin mining?
Things are still not entirely clear at this stage, though everything points to Beijing wanting to ensure environmental hazards become a thing of the past, and with everyone suggesting bitcoin mining to be one of the most destructive things happening for the planet right now, it seems China does not want to be on the opposing end.
The People’s Bank of China announced in a statement that it was taking necessary action against Beijing Qudao as a means of ensuring the public’s assets were safe and well protected. While it can be argued that China appears to have its heart in the right place, many individuals with firm stances in the crypto space are not pleased with the country’s recent decision.
Criticism has come from the likes of Michael Saylor, the head executive behind software firm MicroStrategy. Having made a name for himself as one of the world’s biggest institutional investors in bitcoin, Saylor recently condemned China’s actions, saying that it will cause trouble for nobody but the country’s regulators in the long run. He said:
I think, given the bitcoin growth rate, this will prove to be a trillion-dollar mistake for China… It is a tragedy for Chinese miners [and] it is a geopolitical mistake for the country, but I suppose they could afford to make a trillion-dollar mistake.
Some Unnecessary Action?
Saylor also took aim at the fact that China was not allowing traditional financial institutions to provide aid or services to crypto mining firms. He stated:
A lot of Chinese had to sell bitcoin under forced liquidations and with a timeframe because they had to get out of the country and all their loans got pulled.