China Crypto Roundup (Jun 8-15): 50M Yuan Blockchain Initiative, Bitcoin Mining in College Entrance Exam, Crypto Accounts Frozen, Bitmain Drama
The Chinese cryptocurrency sphere this past week has seen a 50 million blockchain project give a strong boost into the blockchain industry, bitcoin mining knew by more people in the country as it was included in the country’s college entrance exam, thousands of crypto bank cards frozen, Bitmain’s endless drama and Binance being questioned by state-run media…
China’s Shanxi announces public chain project worth 50mln yuan
The “blockchainification” of China has been underway for the better part of the last two years, but it wasn’t until 2020 that massive, province-wide efforts began taking place. All around the vast, almost two billion-strong country, public companies have been competing to win government-sponsored projects that are set to usher the country into the next era of technology.
A huge blockchain initiative is currently underway in the Shanxi Province, located in the northwest and part of China’s larger North Region. With a budget of 50 million yuan, or around $7 million, was awarded to a blockchain company named Xinji (Shanxi) Zhijiu Chain Technologies.
According to the government’s official announcement, the goal of the massive project is to create and deploy blockchain infrastructure that would cover entire cities. All of the basic services provided by the local government—including bureaucracy, energy, health services, agricultural programs, poverty alleviation initiatives, tax collection, financing—would be based on that blockchain infrastructure.
Bitcoin mining included in China’s college entrance exam
Questions related to bitcoin mining in Sichuan are making their way into the college entrance exams, or Gaokao in China.
With a sign of the growing popularity and focus on cryptocurrencies, questions about bitcoin mining are appearing on students’ practice papers as the country’s Gaokao exams are just around the corner.
A Geography mock exam being widely circulated among the crypto community asks students four questions about bitcoin mining in Sichuan, in which students are asked to provide an analysis of how seasonality would affect bitcoin mining in the province of Sichuan, why bitcoin mines acquire hydropower stations, and why some people suggest to restrict bitcoin mining from expanding in the region.
Though the questions are designed to be themed economic geography coming up every year, the context of bitcoin mining is a topical twist and helps to get more people, especially the youth, to know about the industry which was unwanted by the country in the past but has recently been accepted.
Thousands of crypto accounts frozen
A large number of Chinese crypto traders and OTC market makers have recently been caught up in a police probe into money-laundering activities with their accounts frozen as their crypto transactions may have been contaminated by illicit activities related to telecom fraud, gambling and crypto scams.
Though frozen accounts are not necessarily involved in wrongdoing and supposedly can be unfrozen if the authority finds the account has nothing to do with the “dirty money”, the scale of the frozen, reportedly about 4,000 bank accounts affected, has led to much discussion as well as panic among the crypto community over the past week.
During the weekend, banks in the country came out soothing their users clarifying that they are not freezing user’s funds as long as the operation is legal, the channel is legal and the cryptocurrency resource is legal. But industry insiders still reminded people to use or open a separate account for cryptocurrency trading, though no legal crypto accounts would shut down.
Internal struggle at Bitmain affects miner shipments
Ousted Bitmain co-founder Micree Zhan has taken over the company’s factory in Shenzhen and demanded supplier team to stop shipping miners to clients who have already made the payment.
Zhan, unable to access Bitmain’s IT and finance departments in Beijing, is selling mining rigs to miners close to him and asking clients to send money to him before equipment can be shipped.
On Jihan’s side, Bitmain then issued an internal letter indicating it was solving the problem by legal approach. Starting from last October, the drawn-out struggle between the two has become more dramatic after the recent physical confrontation and harming the interests of clients.
It has cast doubts among investors and customers over the management and future performance of the world’s largest bitcoin mining hardware manufacturer. Miners have been discussing the possibility of Bitmain’s rival MicroBT to overtake its dominance with its powerful WhatsMiner machines winning praises from miners.
Binance questioned over being still accessible for Chinese
Despite having left China following a government ban on crypto trading in 2017, crypto exchange Binance is still accessible for local residents through the platform’s “binancezh.com’ website, says state-run media outlet China National Radio.
In response, Binance claimed that it does not operate in the country and the website in question is a “test site” mostly used by Egyptian residents. While a search result at SimilarWeb shows that just 8% of the traffic to the website comes from Egypt, while nearly 80% comes from China.
China had unequivocally banned ICO and forced the closure of domestic cryptocurrency exchanges in September 2017. It remains to be seen whether there will be an escalated crackdown on crypto exchanges following the investigation and report on Binance by the state-run media CNR.