China Crypto Roundup (Jan.4-Jan.11): State Media Pour Cold Water on Bitcoin, KOLs Warn Correction Ahead, Digital Yuan in Card Form Trialed

During the past weekend, the price of bitcoin has dropped below the $40,000 level.

With the bitcoin rally continuing and keeping breaking new all-time highs, market participants have warned a correction could be imminent.

Market participants warn a pullback ahead

Bobby Lee, the founder and CEO of crypto wallet Ballet has come out to share his prediction with the Chinese crypto community for the leading cryptocurrency last week. According to him, the market may see dips like 40%-60% in the short term during the bull run as investors periodically withdraw profits.

Jiang Zhuoer, founder of crypto mining pool btc.top also believed there’s a chance that a crash like that occurred on March 12 would occur again where bitcoin might fall by 50% in 24 hours and warned investors to be cautious.

Chinese state media pour cold water

The meteoric rise in bitcoin price has led to heated discussions among investors but also murmurs from regulators.

First on Jan. 6, a lengthy op-ed from Chinese state media – the People’s Daily once again called bitcoin a high risky asset and warned the young generation against leverage trading bitcoin. The news piece warned that the bull run the market’s currently witnessing is more dangerous than it looks, claiming that it’s a result of speculation and will end up with most investors losing money.

Two days later, the country’s Economic Daily also published a commentary to pour cold water on bitcoin, claiming that bitcoin trading is still in a gray zone and the control or suppression over cryptocurrencies will be intensified with the launch of legal digital currencies in various countries in the future.

Trial of digital yuan hard wallet card

The launch of China’s digital currency electronic payment (DCEP) has been stepping closer with the trial of digital yuan in a physical card form in Shanghai.

Medical staff at Tongren Hospital Shanghai Jiaotong University School of Medicine used the digital yuan to pay for food. They used a point-of-sale device and a physical card with a small screen in the top right corner, showing the current payment and balance in the wallet. It allows staff to buy products such as a cup of coffee or snacks. The Postal Savings Bank of China is in charge of providing technical support.

So far, the digital yuan pilot programs have been underway internally in Chinese cities such as Shenzhen, Suzhou, Xiongan, Chengdu, preparing for the Winter Olympics — an event which is still scheduled to take place in 2022.