Bank of China publishes infographic explaining why Bitcoin is valuable and how its value keeps increasing ๐จ This article is 5 years old...
Bank of China publishes infographic explaining why Bitcoin is valuable and how its value keeps increasing
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Updated: Apr. 22, 2021 at 12:04 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Samson Mow, the chief strategy officer at Blockstream, revealed on July 27, 2019 that the Bank of China has published an article that explains how Bitcoin works, and why its price keeps increasing.
Yesterday the #BankofChina posted up an article about #Bitcoin. They explained how $BTC works, why the price is going up, and why itโs valuable. Never thought Iโd see that happen. ? #Bullish pic.twitter.com/GKzj7XJjJa
— Samson Mow (@Excellion) July 27, 2019
An infographic on the bankโs website illustrates how Bitcoin came into existence, beginning with the release of its whitepaper in November 2008. The Bank of Chinaโs website also notes that the first 50 Bitcoins were mined in early 2009 when the genesis block was produced.
Bank of China explains why Bitcoinโs value continues to rise
The bankโs infographic also points out that Florida resident Laszlo Hanyecz paid 10,000 BTC in 2010 for two pizzas. After covering basic information about Bitcoin, the Bank of China noted that Facebook is developing its own cryptocurrency, Libra.
According to the bank, Bitcoinโs value continues to appreciate due to its limited supply of 21 million, and it may serve as a store of value, especially for citizens of countries suffering from high levels of inflation.
Bitcoin is โvirtual propertyโ
On July 18, a court in Hangzhou, China clarified that Bitcoin qualifies as โvirtual propertyโ, which reaffirmed the nationโs stance that itโs legal to own the pseudonymous cryptocurrency. The court also said that bitcoin holders are entitled to legal protection in disputes.
A study published by CoinShares in late 2018 revealed that approximately 60 percent of Bitcoinโs hashpower is generated in China. Meanwhile, researchers at Diar found that unregulated local crypto exchanges handled 60 percent of the worldโs USDT trading volume.
While Chinese citizens may continue to find alternative ways to engage in crypto trading, the digital assets industry has been severely restricted by the nationโs authorities. In September 2017, Chinaโs government placed a ban on local cryptocurrency exchanges and initial coin offerings (ICOs).
Due to these restrictions, Chinese residents may hold digital assets but might not have a convenient way to exchange their holdings for fiat currencies.
Chinese Bitcoin miners steal $3 million worth of electricity
Chinaโs reserved stance toward cryptocurrencies may partially be attributed to a large number of scams and other illegal activities associated with them. On July 12, the Guardian reported that Chinese police officials had uncovered an illicit mining operation that was running on stolen electricity.
As detailed in the incident report, the miners had stolen $3 million worth of electricity to illegally mine Bitcoin. Authorities in Zhenjiang, a city located in eastern Jiangsu province, confiscated nearly 4,000 units of mining hardware from the illegal operation.
Update July 27 @ 10:16 pm Pacific time: A previous version of this article stated that the Bank of China was a central bank, which it is not. The article has been updated to reflect this fact.
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Bitcoin
$98,569.00
Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
Blockstream
Blockstream is a provider of blockchain technologies, on the forefront of work in cryptography and distributed systems.
Samson Mow is known for his double role as the Chief Strategy Officer (CSO) at Blockstream and the Chief Executive Officer (CEO) at Pixelmatic.