Daily: is China in LOVE with Blockchain ?!?!
Description
China's Biggest Political Event Sees Blockchain Praise. Does it mean China is opening up? 0:58 Market Analysis 1:58 Bitcoin Transaction Volume Hits Two-Year Low 3:18 China's Praises Blockchain - but ...
AI Analysis
This video dives into China's fascinating and often contradictory relationship with blockchain technology, alongside an update on the crypto market and a deep dive into the recent NEO network pause. You'll learn why China is embracing blockchain tech while cracking down on cryptocurrencies, how current low Bitcoin transaction volumes can save you money, and the real story behind NEO's temporary halt.
Here's a breakdown of the key insights:
* Current Market Overview:
* The overall crypto market cap is pretty stagnant, hovering around $447 billion.
* Ripple saw a price drop due to unverified rumors about a potential Coinbase listing; generally, it's best not to speculate on such rumors.
* Chinese exchanges like OKEx and Huobi are currently dominating Bitcoin and Ethereum trade volumes, which is interesting since they don't directly allow Chinese users – it seems ex-Chinese operators are very active.
* Bitcoin Transaction Volume Hits a Two-Year Low:
* Due to less market speculation, Bitcoin transaction volume has hit its lowest point in two years.
* This is actually great news for users because transaction fees are dropping significantly, making it much cheaper to send Bitcoin.
* Exchanges, including Coinbase, are also lowering their withdrawal fees, which is a bonus.
* Actionable Tip: If you've received many small Bitcoin payments (meaning lots of "inputs" in your wallet), now is a good time to combine them into one larger input. Bitcoin transaction fees depend on the number of inputs, not the amount of Bitcoin, so consolidating them now at low fees will make future transactions cheaper for you.
* China's Complex Relationship: Loving Blockchain, Disliking Cryptocurrency:
* China's official stance is clear: they love the underlying blockchain technology but are highly cautious, even hostile, towards cryptocurrencies and ICOs.
* Pony Ma, CEO of Tencent (a massive Chinese tech conglomerate behind WeChat), publicly stated that while blockchain is excellent, its future lies in practical applications, emphasizing that ICOs are risky and Tencent has no intention of launching its own cryptocurrency. This statement perfectly aligns with the official party line.
* This means China is strongly pushing for the adoption of private blockchains among its large tech companies. Public blockchains (like Bitcoin or Ethereum) require a native cryptocurrency to reward nodes and maintain security, which China wants to avoid for control reasons.
* Alibaba's subsidiary, Lynx Technology, is also exploring blockchain for shipment logistics, likely utilizing a private blockchain solution.
* Chinese tech giants benefit immensely from the "Great Firewall" that blocks international competitors like Google and Facebook. To maintain this protected environment, they are careful to please government regulators.
Insight: The core limitation of private blockchains is that they lack the "trustless" property. In a private blockchain, a single entity controls the nodes, essentially making it a centralized database. This means you have to trust* that single entity, which defeats the purpose of decentralization where external, independent nodes verify transactions.
Despite this preference, China still uses public blockchains for certain applications. For instance, VeChain is helping China build the smart city of Guayan, specifically for anti-counterfeit measures. For anti-counterfeiting, you need* a trustless system where multiple parties confirm authenticity, not just one company controlling the data.
* There's an ongoing internal competition within China between private and public blockchain adoption. For things like inter-corporate value transfer or external audits (like with PricewaterhouseCoopers partnering with VeChain), a public, trustless blockchain is far more beneficial for verification.
* NEO's Network Pause: Understanding the FUD:
* NEO recently experienced a significant price dip and widespread FUD (Fear, Uncertainty, Doubt) after its network temporarily paused, sparking questions about its decentralization and reliability.
* A tweet from Eric Walls highlighted concerns about NEO's decentralization and questioned why its DBFT (Delegated Byzantine Fault Tolerance) consensus mechanism stalled when a node disconnected.
* Presenter's Take: The fact that NEO currently operates with seven consensus nodes managed by the NEO Council shouldn't be a surprise to anyone who's researched the project.
* Key Trade-off: NEO has intentionally chosen to prioritize faster development and quick feature upgrades (like smart contracts) over immediate, extreme decentralization. This is a common compromise in the tech world: highly decentralized systems like Ethereum often have slower upgrade cycles (sometimes taking years), while more centralized ones can deploy faster. NEO, as a younger project, opted for speed.
* Regarding the pause, Da Hongfei (NEO's founder) stated that the network performed as designed. It prefers to pause to ensure "finality" – meaning transactions aren't messed up – rather than continuing to pump out potentially erroneous blocks. A bug caused the pause, and it's currently being fixed.
* The Opaque Curtain of Chinese Crypto Activity:
* It's challenging to get a clear picture of what's truly happening in China's crypto space due to its opaque nature and conflicting reports.
* Surprising Insight: Despite numerous articles claiming China has banned Bitcoin mining and that Chinese miners have entirely left, this is "completely untrue."
* Peter Nguyen, who runs massive mining operations in China, confirms that Chinese miners are still very active but are intentionally secretive about their locations to avoid official statistics.
* The biggest factor driving miners to move abroad isn't government policy, but simply the search for cheaper electricity costs in places like Canada and the "Ring of Fire."
* Crucial Takeaway: When it comes to China, it's essential to "not look at what they say, look at what they do." The government's increasing crackdown on cryptocurrency trading actually suggests that a significant number of Chinese people are still actively involved in trading crypto within the country.
Transcript
So today on Box Money Daily, I'm going to start off with the market analysis. And it seems that China is trading quite a bit. So this kind of episode will mostly center around two Chinese topics. We have China, they're praising blockchain at an official event, but they're using the official party language. So we're going to look and analyze the language and how that affects future blockchain development. We also have NIO. There is a certain amount of FUD surrounding NIO right now. So we're goin...