Bitcoin shot higher today and peaked just shy of the $8,800 level for the first time in two weeks, buoyed by Chinese president’s speech that his nation must take all advantages offered by the blockchain technology.
The largest cryptocurrency surged as much as 14 percent from Thursday’s close, which was actually its lowest point since early May. Bitcoin led gains among other cryptocurrencies, which also rose over 12 percent, according to a Bloomberg pricing index, which tracks a basket of rival coins.
Crypto markets reacted to Xi Jinping’s statement that the time has come for the country to harness the true potential of technology that underpins the cryptocurrencies. The Chinese leader said they have no choice but to embrace blockchain tech due to its importance “in the new round of technological innovation and industrial transformation.”
President Xi also noted that China should focus on accelerating the adoption of blockchain architecture to ensure its use in financial transactions, saying that the promising technology could set the stage for resolving the real economy’s issues.
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China favors blockchain over cryptocurrency
Crypto proponents are taking encouragement from a string of recent headlines showing greater interest in the space from China. Apart from Xi’s speech, the news comes amid China’s desire to launch the world’s first government-backed cryptocurrency. Several Chinese officials have publicly spoken out over the past several weeks about the need for China to launch its own digital currency, and the country’s central bank appears to be making rapid progress in the process.
China previously declared war against cryptocurrencies, prohibiting initial coin offerings and clamping down on its promoters. But China’s raid on the virtual asset class, which started in September 2017, failed to dampen local investors’ enthusiasm, as many have resorted to other channels to get around the crackdown.
Despite such reservations, the government supported the underlying blockchain technology to revolutionize economic sectors and even included the technology in its roadmap for the nation’s development by 2020.
Besides start-up companies, the affiliates of technology giants such as Alibaba, Baidu, and Tencent appeared in the list of firms exploring blockchain’s potential uses. Their blockchain-related initiatives with the names like Baidu Blockchain Engine (BBE), Alibaba Cloud Blockchain-as-a-Service (BaaS), Tencent BaaS (TBaaS) and the BaaS platform owned by JD.com were recently among the companies featured in the crypto media.