China Blockchain Madness
Written by: Ryan Selkis
So. Much. News. Excitement. Drama.
Coming out of China this past week. The Chinese government even found its way into our long-form research on the Evolution of Stablecoins. In Ryan Watkins first research brief, he recapped the three economic models of stablecoins and outlined how China and Facebook were emerging as the two preeminent issuers of new digital currencies. (Sign up for Pro here to read in full!)
It wasn’t just us picking up on the China narrative.
Things definitely got a little weird following the blockchain hype out of Beijing late last week.
Days after President Xi Jinping spoke about the need to “seize the opportunity” in crypto, we learned that one of the first orders of business would be to run a centralized purity test…on a blockchain? The new “Original Intentions Onchain” dapp would let party members pledge immutable (maybe?) allegiance to the CCP.
Weird flex, but ok.
Perhaps it’s no surprise there’s been a positive reaction from Chinese entrepreneurs hoping to capitalize on the immediate surge in interest. (Xi’s comments led the country’s state run news to devote prime time and front page coverage to blockchain on Friday, leading to a massive jump in search traffic for bitcoin and blockchain.) It’s also no surprise that the western celebration of Xi’s comments drew consternation from the libertarian strand of the bitcoin community with some decrying the warm reception given his party’s history of surveillance and crackdowns on speech.
This may seem like the simple continuation of a six year hot and cold mixed-messages cycle of feedback from the Chinese authorities. But this time (don’t say it, don’t say it), it does feel different.
Things have to be feeling different at mining giant Bitmain, too.
Bloomberg reports co-founder, Jihan Wu, who had stepped down from the CEO position earlier this year following a tumultuous aborted IPO process, announced the “resignation” of his co-founder Micree Zhan Ketuan. The rift appears contentious as Wu allegedly warned employees in an internal memo that “taking further instructions from Zhan or attending any meetings he convenes” would lead to dismissal or criminal charges.
This one is interesting because it could become a high profile case in China of two of the country’s top crypto entrepreneurs slugging it out in public. Zhan is the largest shareholder in the company, as Bitmain’s earlier IPO prospectus showed Zhan held a 37% stake in the company to Wu’s 21%. That means investors must have endorsed something Dovey Wan equates to a Godfather-like hit. During the “coup” Zhan’s “email was deleted and he was promptly banned from the home office by security."
Apparently this all kicked into motion while Micree was out of town at a conference.
This is the tip of the iceberg on crypto in China. But never fear!
NLW breaks down the full narrative on China’s competitive positioning in crypto in this week’s Narrative Watch.
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