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Chinese State Media Try and Quell Blockchain Excitement with Warnings

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A lot has happened this week inside the crypto industry and China as well. The market saw a sudden boost for virtual currencies following Chinese President Xi Jinping’s bullish comments on blockchain technology. Apart from the virtual currencies, the shares of all the A-share firm’s that are believed to be involved in blockchain or cryptocurrency-related businesses saw a drastic rise in stock price, with most of them hitting the daily limit of 10% as soon as the market opened.

Don’t “speculate”

However, Chinese state media has asked investors to remain calm about the whole situation and not take Beijing’s support for blockchain as a boost for cryptocurrencies. According to a report by Reuters on October 29, local news outlet the People’s Daily, published by China’s ruling Communist Party, said in a commentary on Monday, that:

“Blockchain’s future is here but we must remain rational, the rise of blockchain technology was accompanied by that of cryptocurrencies, but innovation in blockchain technology does not mean we should speculate in virtual currencies.”

Apart from this, some traders from three Chinese brokerages have received a notice from Shanghai Stock Exchange on Monday which stated that “for any blockchain-related (topics), we ask listed companies to make statements based on facts and not make any exaggerated claims or create vicious hype”. Even though the Stock Exchange did not respond to a request for comment, the Chinese authorities are well known to be cracking down on the countries crypto industry.

Many Chinese officials have said that research and development on the blockchain technology are still encouraged. Xi’s comments were the first time Beijing publicly showed support for this budding new industry despite the fact that Beijing is also creating its own bank-issued digital currency to cut costs related to circulating paper money while boosting policymakers’ control of money supply.

Bitcoin making a move

However, all these events have been linked directly to Bitcoin’s massive jump. BTC on Friday, October 26, saw the highest intraday gains since 2011 as it moved from $7400 and touched $10,500. The market sentiment is positive so far with BTC/USD up 28%.

Anna Larsen
Anna Larsen has been a Crypto enthusiast since 2016. Fascinated by the technology and its usecases she decided to pursue a career in content creation related to this space. The journey has been exciting ever since.

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