Trillion Dollar Mistake: Is China Planning To Reverse Crypto Ban?

Earlier in the year, China had embarked on what is considered the biggest crypto crackdown to date. The country has had a tumultuous relationship with the crypto space in the past, announcing various bans. But the severity of its last crackdown had led to the exit of miners out of what was said to be the ‘crypto mining capital of the world.’

The impacts of the crackdown on the market had not been mildly felt either. Bitcoin had hit its highest value at that point back in April. However, following the crackdown, the price of the digital asset had crashed back down, dragging the broader crypto market with it. The market had suffered as it saw over 50% hashrate wiped out in the wake of the crackdown.

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Now, though, it seems that the government of China is rethinking its stance on the crackdown. A new survey was sent out by China’s National Development and Reform Commission asking citizens for their opinions on the recent crypto mining ban.

The survey will poll participants for a month. After which the data from the survey will be compiled. The Chinese government has not commented on what it plans to do with the data once the poll duration is complete. But speculations abound in the space that the government may be starting to reevaluate the strict stance it has taken with regards to the crypto market.

Trillion-Dollar Mistake

Back when China had begun its crackdown on crypto mining in the country, Michael Taylor, CEO of MicroStrategy, had publicly stated that the government was making a ‘trillion-dollar mistake.’ Saylor told Bloomberg that the country was cracking down on an asset that generated $10 billion a year with a 100% year-over-year growth.

Crypto total market cap at $2.6 trillion | Source: Crypto Total Market Cap on TradingView.com

China had control of about 50% of the bitcoin market before the crackdown and featured a flourishing crypto market. The crackdown saw China’s hashrate crash to zero while other countries took advantage of the opportunity created by this to welcome miners to their regions.

United States Vying For Crypto Dominance

Upon their exit out of China, the displaced miners soon found themselves in a position where they needed to find new, favorable locations to set up their crypto mining operations. The United States did not waste any time in seizing the opportunity to make the miners feel welcome. Various states in the U.S. like Florida and Texas passed favorable laws to entice the miners to their region.

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It paid off as the United States now has the largest hashrate in the world. Although it is still not as high as what China commanded before the crackdown, the North American hashrate has been growing steadily since then. Presently, the U.S. accounts for 35% of the total global hashrate, up from 16% in April of 2021.

Featured image from NDTV Gadgets 360, chart from TradingView.com