China’s central bank, The People’s Bank of China (PBoC), has stated that the Chinese yuan now accounts for less than 1 percent of global Bitcoin (BTC) transactions, local news outlet Asia Times reports today, July 9.
The PBoC released a new report on Friday, July 6, indicating that the yuan’s share of global Bitcoin trades has plunged in the months following the government’s crackdown on the cryptocurrency industry, Asia Times reports.
Whereas in 2017, Chinese exchanges accounted for over 90 percent of the global crypto industry –– a figure corroborated in this week’s PBoC report –– their current less than 1 percent share reveals the momentous impact of policy restrictions. Guo Dazhi, research director at the Zhongguancun Internet Finance Institute, is quoted by Asia Times as saying that:
“Th[e new figures] indicate that the policy has been very successful. It is within expectations that the yuan’s share in global Bitcoin transactions would drop after China announced the ban.”
Local media outlet XinhuaNet has quoted the PBoC’s report as saying that the country’s policies had ensured a “zero-risk” exit for the 88 cryptocurrency exchanges and 85 ICO trading platforms closed since late 2017.
China’s Sep. 2017 ban on crypto exchanges and Initial Coin Offerings (ICOs) became yet more stringent in early 2018, with officials stepping up their restrictions in January to include a broader category of “market-making” platforms and services.
In February, China added offshore cryptocurrency exchanges and ICO websites to its Great Firewall, further toughening its stance.
Further local media reports have this week suggested that China does not intend lift its ban on Bitcoin trading any time soon, still considering the volatile cryptocurrency market to pose excessive risks for domestic investors.
Notwithstanding its hardline stance on decentralized cryptocurrencies such as Bitcoin, the PBoC has nonetheless been pursuing a longer-term vision for tightly controlled blockchain integration into the traditional financial sector.
Just two weeks ago, the bank filed a new patent for a digital wallet, the same month as it revealed its new blockchain-powered system with smart contract functionality designed to tokenize paper checks.
The Governor of the PBoC said this spring that while virtual currencies are “technologically inevitable” and will ultimately diminish cash circulation, the PBoC intends to control the “unpredictable effects” posed by decentralized forms of crypto and certain applications of blockchain.