US President-elect Donald Trump’s commitment to bolster the cryptocurrency sector could catalyze a revival of mainland China’s digital-asset market, as suggested by industry expert Xiao Feng, chairman and CEO of HashKey Group. In a recent interview, Xiao indicated that if the US Congress and the incoming administration clarify and promote crypto policies, it could significantly influence China’s stance on cryptocurrencies. He posited that while China might have taken five to six years to embrace cryptocurrency businesses under normal circumstances, recent geopolitical events could accelerate this timeline to just two years.
China has long enforced stringent regulations against initial coin offerings (ICOs), crypto trading, and mining, viewing these activities as threats to financial stability and potential avenues for illicit activities. However, Xiao’s remarks reflect a growing optimism within the cryptocurrency community following Trump’s election victory. Trump has expressed intentions to position the US as a leader in the digital-asset space, including plans for a “strategic national bitcoin stockpile” and efforts to dismantle regulatory barriers perceived as hostile to crypto innovation.
The cryptocurrency market has responded favorably to Trump’s election, with Bitcoin recently surging past $81,000—a nearly 85% increase since the beginning of the year. Despite this bullish trend, the Chinese government has not indicated any plans to ease its ban on digital assets. Nonetheless, Hong Kong has been permitted to advance its digital-asset initiatives.
Should China decide to reinvigorate its digital-asset market, Xiao suggests that it could begin with a payment-clearing system utilizing regulated stablecoins—cryptocurrencies pegged to fiat currencies like the US dollar. He noted that a survey conducted in Yiwu, a key manufacturing hub in China, revealed that nearly all merchants had received inquiries about accepting popular US-dollar-based stablecoins such as USDT and USDC for transactions.
Xiao’s extensive background in banking and finance informs his insights into this evolving landscape. Before founding HashKey in 2018, he held senior roles at the People’s Bank of China and the China Securities Regulatory Commission. Under his leadership, HashKey has grown into a significant player in Asia’s cryptocurrency market, with plans to launch its own blockchain, HashKey Chain, next month.
Despite many crypto firms relocating to more favorable jurisdictions like Dubai and Singapore, Xiao affirmed HashKey’s commitment to Hong Kong. He believes that maintaining a presence there is crucial for serving mainland China once it opens its market to digital assets.
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