Skirting the Great Wall, Part Three: The Paradox of Cryptocurrencies in China

Their action has spanned the notorious criminalization of initial coin offerings in Sept. 2017, followed by a series of stark measures that target crypto trading platforms, third-party crypto payment channels, social media networks, and offline crypto-promotional events.

Cointelegraph's three-part series on the history of cryptocurrencies in China opened with the conundrum of how it is possible that, despite this ever-escalating onslaught of harsh rhetoric and iron-fisted interventions, the use of crypto for various transactions remains possible; popular Twitter-based Chinese crypto news source cnLedger pins a post to the top of its profile that shows a domestic retailer openly accepting payments in Bitcoin, Ethereum, or Bitcoin Cash for a glitzy McLaren sports car.

As a further indication of this apparent anomaly, three stories broke this fall that epitomized the uneven nature of China's crypto landscape.

Testing the waters, a multi-episode documentary produced by a group of self-described crypto enthusiasts dubbed "Team 1234" this fall showed the results of a 21-day experiment to see whether it would be possible to survive using only crypto in China.

If aspects of crypto's future in China remain uncertain, the more liberal past has proved to be fertile soil for China-born innovators to lay the foundations for their future fortunes: thirteen of the wealthiest people in China as of October 2018 were reported to be crypto entrepreneurs.

While China's mainland restrictions may in retrospect have paradoxically accelerated the burgeoning wealth of its exiled crypto exchange tycoons - prompting platforms to successfully expand their services overseas under duress - exporters of crypto mining gear now face a hurdle that is for once not related to the domestic regulatory noose.

With the domestic mining industry thus shaken by the impact of both the crypto bear market and of geopolitical shifts in international trade - and after a summer of the authorities' redoubled efforts to stifle crypto trading - the environment for the local crypto industry is hardly auspicious.

The defendant countered the plaintiff, arguing that the core "Payment and arrangement of the transfer price" clause of the contract was in violation of the mandatory provisions of Chinese law, which prohibits the sale and circulation of crypto tokens, as well as the trading platforms used as a venue for their transfer and exchange.

The breakneck pace set by technological innovation could mean that a new, as yet unimagined chapter for crypto in China, will open in future.

Experiments such as "Bitcoin Girl" show the appetite for change is there, and domestic crypto investors have to date indicated they will use every means available in their arsenal - from VPNs to over-the-counter trades - to preserve their autonomy and reinvent the future of the space.