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Jihan Wu: Chinese Government Won’t Aggressively Regulate Bitcoin

Last Updated March 4, 2021 4:55 PM
Rebecca Campbell
Last Updated March 4, 2021 4:55 PM

Bitcoin entrepreneur Jihan Wu has spoken out and said that the Chinese government only wants to control the risk of bitcoin for investors who don’t know much about it.

In a report from ABC News , Wu, who operates Bitmain, a Beijing-based company that develops and sells the world’s leading bitcoin miner hardware using Bitmain’s ASIC chip technology, said:

The [People’s Bank of China] can potentially have very strong control over the price of bitcoin, at least in the short term, because it can effectively cut the money flow involved in bitcoin trading.

“Potentially [the PBOC] could shut down all the Chinese bitcoin exchanges,” he added.

Chinese Bitcoin exchanges could be shut down by the PBOC if it chose to do so, says Jihan.

However, he added that he didn’t think the government would conduct aggressive regulation over the digital currency, stating:

But I don’t think the Chinese Government will do very aggressive regulation over bitcoin. I just think they want to control the risk for those investors who don’t have enough knowledge about bitcoin.

This news comes after the fact that the PBoC has recently taken an increased interest in Chinese exchanges. In February, digital currency exchange BTCC announced that it was halting its Bitcoin and Litecoin withdrawals as Chinese regulators updated their anti-money laundering measures. OKCoin and Huobi announced a similar measure too.

As a result of the PBoC conducting on-site checks in February, the price of the digital currency dropped to around $790; however, despite the crackdown on digital exchanges with the PBoC director stating that they can’t function without regulations, the currency is continuing to rise in value.

Bitcoin Scalability Debate

As the discussion surrounding the potential bitcoin hard fork increases, many proponents are coming out in support of either Bitcoin Unlimited (BU) or SegWit as the potential solutions to the digital currency’s backlog issue.

So much so, that Wu, who is also the founder of Antpool, which is the digital currency’s largest pool with around 14 percent of the network’s hardware share, announced last month that they would be switching their entire pool over to BU in support.

Wu has also shared a post on his Weibo account from an unknown author, which declared that the network’s problem can only be achieved by talking about the ‘distribution of interests‘ and reaching a ‘compromise in the pursuit of those interests.’

And yet, many believe it is only through SegWit that a solution can be found particularly when it comes to transaction malleability, which is a bug that makes it difficult for developers to implement second layer protocols. Those in support of SegWit are of the opinion that SegWit can fix this bug.

Featured image from Shutterstock.