For a long time, inside and outside the crypto community, there has been a fear of China’s dominance over the Bitcoin Blockchain. And it is that, in the Asian country, most of the computing power on which the cryptocurrency network is based is concentrated. This is a fear shared by Peter Thiel, a co-founder of PayPal and an investor in technology projects. Who warns that Bitcoin can be a Chinese weapon to unseat the dollar as an international reserve currency.
Chinese influence on Bitcoin
Chinese influence has not stopped increasing in Bitcoin in recent years. Impressive considering that the Beijing government has put in place some of the toughest regulations on the crypto market. Especially with the prohibition of exchanges in its territory, which already in the past forced Binance to migrate from China to continue operating.
However, the Asian country has many comparative advantages over other nations, which allows it to attract talents and companies from the crypto world, especially mining farms. Which take advantage of the availability of capital in the Chinese market, added to the low costs of electricity, to create large mining complexes in the country.
Thanks to this, today most of the mining power of the Bitcoin Blockchain is concentrated in Chinese territory. Which provides the country with enormous leverage over the rest of the crypto community. Raising the possibility that one day the Chinese government will use this power to manipulate the BTC chain. A fear that seems to be at the bottom of Peter Thiel’s statements.
Peter Thiel distrusts
Thus, at a round table in which the former Secretary of State, Mike Pompeo, also participated, Peter Thiel expressed his fear of the possibility that Bitcoin could be a Chinese weapon. Used by the government to lessen the influence of the United States and its currency, the dollar, in the international financial market.
«Although I am a pro-crypto, pro-Bitcoin maximalist person, I wonder if at this point BTC should also be seen in part as a Chinese financial weapon against the United States. This threatens fiat money, but especially threatens the dollarPeter Thiel commented.
On other occasions, the Chinese government has publicly raised the need to transcend the US dollar as an international reserve currency. However, there is no evidence so far that China is seeking to use Bitcoin as a weapon to advance its interests. Rather, Beijing is developing its own government virtual currency to deal with the growing influence of the crypto world.
However, Peter Thiel’s statements should not be taken lightly. Well, the fact that China is not making use of Bitcoin at this moment does not mean that this cannot happen in the future. Either directly by controlling mining farms, or indirectly by financial means. Being one of the risks that exist in the crypto market.