Is it real? Is China seriously fighting bitcoin?

Let's jump right into the news!
As time goes on, we have figured that China's really going against bitcoin but not in every possible way and not for every company. Let's have a look at what happened in the past:
China has declared the hottest part of the cryptocurrency market illegal. It made news on the 4th of September 2017 and their talking about ICOs. In December, another headline, saying: “China’s Central Bank believes bitcoin will die” turned out to be real news (not fake). So for those people who are new on cryptocurrencies, this is not a rumor. We have to understand that FUD (fear, uncertainty and doubt) out of China is sometimes real and sometimes basically just FUD but they actually banned ICOs (initial coin offerings). It is illegal to raise money in the form of an ICO in China as of this writing. Also, in this headline, it seems to be over because it says China's biggest bitcoin exchanges will halt all trading services for local customers. Maybe you already know about this but many of those people who joined Bitcoin in its all-time high may have never heard about it.

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China is a big player in the cryptocurrency space.
They’re not just active with project development but also, they're very big in the mining game. We're going to talk about that today. In the last couple days, there were a lot of rumors going on that China is also going to attack mining. Of course, that would affect the whole cryptocurrency or the whole bitcoin network significantly. Roughly two-thirds of all the hash power in the network is actually coming from China so, with this news, we can see that this thing is definitely getting serious. China wants an orderly exit from bitcoin mining and further information says that mining factories will be ordered to gradually reduce mining. It is actually a good thing that it won’t happen abruptly if they continue doing this. That way, we know that there won't be any major disruption in the Bitcoin network. It doesn't mean that they have to stop Bitcoin mining tomorrow, for example. But they're talking about basically reducing their hash-rate until they are able to stop the mining completely.

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If you look at the price of bitcoin in the last few days, we can definitely see a big downward movement. All the way down to about $14000 which was probably not expected by a lot of people. By now, there should already be a lot of money from altcoins getting into Bitcoin. But right now, if we have a look at the market, we can easily see that there's a downward trend in the whole cryptocurrency world. If Bitcoin is not doing great, well, altcoins are not doing that great either. So this may have something to do with all these rumors about mining but not for sure. If you have a look at the hash power distribution, you can figure immediately that most of the top players like BTC.com and Antpool are based in China. Now, what they have planned out to do suggests that the government of China is not really happy with miners pretty much exploiting or benefiting from low taxes, electricity fees and so on.

Is China anti-cryptocurrency?

Hardly. The People’s Bank of China has run trials of its own prototype cryptocurrency, taking it a step closer to being the first major central bank to issue digital money. China’s vision, however, seems to be based more on taking full control of such transactions in contrast to the libertarian aspirations of bitcoin. Source

So it is a possibility that this ban is not going to be permanent. Maybe it's just for now until they can basically set up something where they can profit more from taxes, for example. Please don't quote me on this but I believe it is a high possibility. From what I heard about the Chinese government, when they see something profitable being exploited by private individuals, they tend to knock it down immediately. The reason being, when they have proven it as a viable source of government income, i.e. they could raise a lot of taxes or there's a lot of money where they can basically take part of the wealth coming from it, they just keep it illegal until they can open up their hand for taxes. For those people who think that this will have a huge impact on the security of Bitcoin network as a lot of hash power getting removed, a post in boomberg.com says that Bitmain, China's largest bitcoin mining collective is setting up regional headquarters in Singapore and now has mining operations in the US.
They are migrating from China to Singapore after exchanges were declared as illegal to operate in China. Some operations will be diverted to Canada and Iceland as well. There’s no reason to be concerned about hash-power.

How is this change going to affect Bitcoin investment payouts?
The change will be gradual and not something we should be concerned about unless mining operations in China throttle down faster than they can be moved to other countries. The hash power pool proportions will definitely change but hopefully, enough will be available to sustain normal operations. I will keep you up-to-date with cryptocurrency news as I learn about them. Please stay tuned.

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