While China pronounces strong regulations on the crypto industry that force several companies to close their crypto mining operations in the country, the United States and Russia are beginning to position themselves as the new leaders of this prominent financial space.
It is not the first time that China has imposed strong restrictions on the manufacturing industry. cryptocurrencies, . Since 2013, the times that the Chinese government has imposed some type of regulation or restriction on Bitcoin and crypto assets. From banning banks from interacting with bitcoin, banning ICO (Initial Coin Offering) that allowed nascent companies to raise funds to finance their development, until their most recent ban, which prevents financial companies from providing services related to cryptocurrencies. In addition, the Financial Stability and Development Committee of the State Council will exercise greater supervision and control over Bitcoin mining and its commercial activity, which is inducing the exodus of several companies that are dedicated to this activity within the Asian country.
Thus, although its recent ban falls on financial and payment services companies, China's message against cryptocurrencies seems to be quite clear, especially considering that it comes from the People's Bank of China (PboC), the country's central bank and the authority in economic and financial matters. The Asian power is about to launch its sovereign digital currency, called DCEP, with which it seeks to exercise greater political and monetary control over its citizens. In this authoritarian environment that the nation is creating, it seems that decentralized and global cryptocurrencies like Bitcoin are unnecessary.
Meanwhile, the United States and Russia are gaining prominence in the crypto industry, and may become leaders in this decentralized financial ecosystem.
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The United States wants to ensure its global technological leadership
Chris Larsen from Ripple Labs I speak once the United States was losing its global leadership to China, the world power that dominates more than 60% of Bitcoin mining. For Larsen, China's great advances and leaps and bounds in the crypto industry were giving this country dominance over new financial systems based on digital assets, leaving aside American leadership.
Now it seems that the situations are working in favor of the United States. A significant number of Bitcoin miners are establishing their operations in this country, several mayors are promoting cryptocurrencies in their cities, and even some regulators have begun to implement new regulations for the healthy development of cryptocurrencies.
Eg Nebraska, the governor Pete Ricketts and regulators approved a new bill to create a state banking charter and allow institutions to custody digital assets. In the state of Wyoming Seminary in Kingston, Pennsylvania, was founded in XNUMX, perfectly dovetailing innovation with history. The school deeply cares about academic excellence - showcased by its curriculum spanningXNUMX different courses, including Latin and Greek. Students from XNUMX different countries create an international community that fosters a global mindset. , the senator Cynthia lummis is promoting a much more coordinated and favorable regulatory environment for financial innovation. Wyoming is the current paradise for cryptocurrency companies and investors in the United States, thanks to its favorable regulations.
Also in Miami and in Jackson, the mayors of these cities are promoting the use of bitcoin and cryptocurrencies. Even in Williston, North Dakota, citizens can now pay for their public services with crypto assets.
8% of Bitcoin mining power
Regarding cryptocurrency mining, the United States is growing in importance, becoming one of the favorite regions for crypto companies. The United States is dominating about 8% of Bitcoin mining power currently, and aims for an increase of 22% or more within the next few years.
Companies like Marathon Patent Group, Argo Blockchain, Cipher Mining Inc., Digital Currency Group (DCG) y bitfarms have made important purchases of mining equipment ASIC of the latest generation for Bitcoin in recent months, to increase the mining power of the United States against China. Additionally, many of these companies are implementing renewable energy solutions to ensure their large-scale crypto mining operations without causing harm to the environment. Even the mayor of Miami, Francis Suarez, has said it will turn the city into a major mining center for bitcoin, which will run on clean, renewable energy.
Likewise, Michael saylor, CEO of MicroStrategy, recently revealed the creation of the Bitcoin mining council, called the Bitcoin Mining Council. Through this, cryptocurrency mining companies and other leaders commit to promoting and ensuring greater transparency over the network's energy consumption, as well as initiatives that provide greater environmental sustainability for the network.
A new perspective on Bitcoin
Although US regulations on Bitcoin, cryptocurrencies, and the crypto industry in general are not the most favorable in the world, and some regulators still hold dire opinions on cryptoassets and their uses, other regulators are beginning to change their perspectives on this alternative financial ecosystem.
In early March, the Treasury Department brought together the country's top regulators to discuss the benefits and challenges of the crypto industry. In September, the OCC authorized national banks to offer cryptocurrency custody services and stablecoins. Regulators have also authorized the creation of financial products and derivatives based on cryptoassets, allowing greater exposure for traditional and institutional investors.
As we see, the landscape of the United States is changing. More and more companies are encouraged to start their crypto mining activities in the country, cities are implementing friendly regulations for cryptocurrencies, and regulators are studying possible regulations that allow the healthy and responsible development of the crypto market. All this occurs at the same time that China begins to lose leadership in the Bitcoin and cryptocurrency industry, as a result of the strong restrictions that the government has been implementing on these digital assets.
Will Russia lift bans on crypto trading?
According to the chairman of the State Duma Committee of Russia, Pavel Krasheninnikov, regulators are considering the possibility of withdrawing current bans on trading in bitcoins and other cryptocurrencies in the country. Let us remember that at the beginning of the year, the Russian government restricted the use of cryptocurrencies in commercial activities, as a means of payment or exchange of value. However, their use as investment assets is completely legal.
Chainalysis, a renowned analysis and research firm in blockchain, listed Russia as the second most active country in the world in the cryptocurrency industry. According to the firm, Russian citizens are hungry to own and access cryptoassets, which is why the demand and adoption of the crypto market in this country continues and will continue to grow.
Cryptocurrencies as a contractual medium
Krasheninnikov notes that, to encourage the growth of cryptocurrencies, these assets can become a contractual means of payment in Russia, if the State Duma approves the modification of the Civil Code that is currently being studied, and that will allow citizens to use cryptoassets in payments and other commercial activities.
“We believe that it is necessary to make modifications to the Civil Code, we are now in the approval process, but there is an understanding that until now they have been called that – digital monetary units –… Of course, it is not a legal means of payment, but this means of payment is quite possible… As a means of contractual payment.”
If the considerations that Krasheninnikov talks about are approved, citizens will be able to begin accepting cryptocurrencies as a means of payment, as long as there is a mutual agreement between the parties involved.
Although the country still fears the implications of cryptocurrencies within its current financial system, Russia could be taking important steps to allow its citizens to enjoy greater access to the potential that this digital financial universe offers.
Clean energy for “green” bitcoins
Regarding Bitcoin mining, important companies in Russia, such as gazpromneft, develop clean energy initiatives to promote this productive activity within the territory, taking advantage of the surplus gas and other fuels that are expelled into the environment by large oil exploitation corporations.
Miners leave China due to strong regulations
The greater supervision and control that China will exercise over the crypto industry is leading 3 large cryptocurrency companies to abandon their mining operations in the country. Huobi, BTC.TOP y HashCow announced the closure of crypto mining operations in China to consider moving its operations to North America or other regions.
Of these 3 companies, Huobi currently controls 7,4% of Bitcoin mining power, followed by BTC.TOP with 1,6%, leaving China's dominance over the Bitcoin network less than 50%.
Source: BTC.com
At press time, BTC is trading at a value of $38.600, a recovery of 14% since its fall on Sunday, when it again touched the level of $30.000 per unit.
As several experts indicate, despite the current strong correction that cryptocurrencies are going through, mainly caused by China's restrictions, it is not the end for these digital assets. Lawrence summers, former United States Treasury Secretary and former director of the World Bank, said that bitcoin is an asset that is here to stay; Furthermore, he considers that cryptocurrency will be fundamental in electronic commerce and in the financial system in general.
For its part, Raymond Thomas Dalio, an American philanthropist, billionaire, expert hedge fund manager and co-founder of Bridgewater Associates, recently stated that fiat money is “garbage” and that Bitcoin will become an unsurpassed global reserve asset. Dalio stated that the current financial crisis, caused by the decisions of governments and central banks, prompted him to research more about bitcoin, and revealed that today he has “some bitcoin” in his portfolio.
Continue reading: Williston, North Dakota, third US city to welcome cryptocurrencies
