Yesterday afternoon, a news spread like wildfire, some media learned through insiders, the central bank held a closed-door meeting today, some of the existence of non-standard electricity mines to rectify.
In fact, this news simply does not matter from the wording, because on the mine rectification and handling last year began, especially after the domestic exchange closed last year, the relevant regulatory agencies also discussed on the mine However, the conclusion is that the reasons for closing down the mines are not sufficient and the mines did not cause any more social problems. The risk points are not clear and no specific arrangements have been made. However, all localities have received "window guidance", that is, local enterprises can not participate in the digital currency mining.
To understand many of China's policies, we must first analyze the logic behind it. Originally the problem of the mine, with the central bank has nothing to do, it is a completely local nature, with the business sector of the business management of real enterprises, if you really want to close the mine, it should not be issued by the central bank orders . Therefore, the central bank this meeting, if it refers to the issue of bitcoin mining, then certainly not just to study mining.
At the beginning of the new year, the entire macroeconomic policy is implementing new programs, including central bank-level issues on exchange rates, capital accounts and so on. One of the signals released is that by 2018, we must tighten more stringent capital controls to ensure the independence of our monetary policy.
If we want to further strengthen capital controls, we must first study and what constitutes a potential threat to capital control policies. At present, the bitcoin generated in China due to mining accounts for more than 70% of the global output. The monthly output of various digital currencies in China can be more than 1 billion U.S. dollars based on the current prices. This will give rise to vigilance on the part of central banks and other financial institutions, and the digital currencies produced will, in some way, affect capital controls and the flow of funds in international markets. Under such circumstances, will the operation of the capital control be strengthened by shutting down the mine?
In fact, fundamentally speaking, it is very difficult for China's mining industry to cause a loss of its foreign exchange reserves because the bitcoin domestically produced will be sold in the international market in exchange for the U.S. dollar, even if the U.S. dollar stays in the international market Do not come back, it will not cause the loss of China's foreign exchange reserves. The biggest problem may be the concentration of liquidity in some of the country's capital. In fact, this kind of liquidity is not as drastic as it is to say that investors will put funds from the real estate market to the stock market and return to the real estate market from the stock market or if they are spinning around in their own domestic pools as long as they do not involve such problems as illegal fund-raising. influences.
However, the current overall policy environment in China is changing. If there is a huge asymmetric interest in any one market, so many funds will flock to it, resulting in an impact on other industries. If all kinds of listed companies are running to dig Bitcoin, or people are keen to buy mines to dig digital money, then as the government, it will be very worried, because all kinds of investment strategies lead to a direct impact on certain Industrial Planning and Development Goals.
Here, everyone should understand what I mean.
First of all, from the will, the Central Bank and other relevant agencies are very much hope that all kinds of bitcoin and other mines can be turned off. But the way to shut down, reasons, steps, to be thoughtful. According to Reuters reports, the central bank demanded that local governments take measures starting with energy, electricity and environmental protection to guide the bitcoin mining companies to downsizing. China's central bank also said it can not directly power down bitcoin mining and can only ask local governments to take action.
It means that I really want to shut you down, but the reason needs to be sought by the local government itself. The central bank said that it was unable to limit power directly to Bitcoin mining and that it was also a question of authority. This issue must rely on the local government.
Second, do local governments shut down bitcoin and other mines? This must take into account the current policy and environmental issues, in accordance with the current policy implementation efforts, local government's actions may be faster than expected. Without a local government, willing to carry a "bitcoin mine support" name, just know what it means is enough.
Third, the central bank's directives are relatively modest. They also take into account the negative effects of the policies. This is because the industry is not formed in a day or two. It involves a very wide range of issues. If it is completely cut off, there are indeed no sufficient reasons and it completely runs counter to the logic of the rule of law. If at the legal level, Bitcoin is not defined as illegal assets (such as drugs), the mere fact that Bitcoin is manufactured is hard to characterize as illegal. Therefore, the next step needs to be paid attention to is what are the reasons why local governments will find concrete implementation.
Fourthly, yesterday's news no matter how the interpretation can see the attitude of the government, this is the need to pay enough attention, even if can not be quickly shut down the country's mines, will lead to stealth costs surge. Largest impact may be the larger mines, if not shut down some as "typical", it may be for the policy side, the policy of losing the significance of the release. However, for the relatively small-scale mines and the decentralized mines with various types of retail organizations, the impact will not be too great, but the expansion rate will certainly be lower.
Fifthly, from another piece of news, "At the same time, insiders of the central bank stand down and discourage the power sector from supplying power to the mine." In terms of guidance, this guiding policy may be an already "qualitative" policy. This is the matter of the mine and may have already been decided. "Do not encourage" three words, is the warning to the power sector. At the same time, it also shows that it is very difficult to completely shut down the mine. First, the central bank itself can not exert pressure on the power sector. It is necessary to know those big miners who buy hundreds of millions of kWh at one time and support one side of the economy Not big.
Of course, just as the Bitcoin Exchange is closed down, the closure will not be done in a single action, but the market will issue all sorts of interpretations. However, I can only tell Members that the attitude of the Central Bank is already clear.
For me personally, the focus of my thinking is not about shutting off mines but about how to understand mining.
Mining, in fact, is the computer to use their own maximum power to find a certain data, you can look at the image from a pile of sand to find a gold, if the larger the sand, indicating the difficulty of mining more Big. Therefore, the so-called mining, in fact, is a kind of super-large-scale computer calculation, this calculation can be used in mining, but also can be used in scientific computing, and various types of research.
Humans invented the "electricity" for only three hundred years, but the application of electricity has been expanded without knowing how many species there are. From alternative steam engines, to lighting, to message transfer and more. What is the most efficient application of electricity in the end?
In the case of a country where electricity is scarce, electricity can be used to produce very necessary supplies to solve various transportation and government needs. If it is a richer country, what will electricity do? Such as singing KTV, street neon lights, large playgrounds and so on. In fact, the application of electricity is enough to judge the economic development level of a country or region.
In 2016, China generated the largest electricity in the world, and the total power generation accounted for 25% of the world's total. Given the common sense, mining power in China is indeed the most abundant, especially as the Chinese economy slows down , The waste of electricity itself is on the rise.
However, if the electricity is converted into digital currency, it can be stored. In fact, if excess electricity generation in China can be converted into bitcoin to save, it should be one of the most efficient production and operation the way. The equivalent of electricity in the production of dollars, is the highest value-added processing exports.
In addition, according to the historical development, most of the power in the future may be consumed by computers. This is a judgment I made and can be testified by our generation. Human daily life, the proportion of electricity consumption, will be lower and lower. The future of mankind should be solved digitally and blockchainly to solve all kinds of problems. The "mines" will only increase but will not decrease. Especially with the development of artificial intelligence, space exploration and other fields, the calculation of power requirements will show exponential growth.
Electricity is just a kind of energy, like a person, really consume the most energy, not the limbs, but the brain, the human brain is a 24-hour machine, a loving man, the brain consumes the liver every day 75% of the blood sugar is stored, while the oxygen consumption accounts for 20% of the whole body oxygen consumption. The more the brain thinks, the more glucose the neurons need.
When the lamp was invented two hundred years ago, the best use of electricity was to turn it on. Future use of electricity where the most effective, it should be the market has the final say.
It is hard to understand the mystery of the existence of this thing, no one can see it until now, but electricity has changed the world. Many virtual things are often more influential than physical things. What does "digital asset" mean to China and the world? I think many people, including the government, find it hard to find out clearly at this time. What we need to reconsider is that in addition to the four great inventions, electricity, light, telephone, computer, digital currency, etc., are pushing people to make strides forward. How many were invented by China?
When a phenomenon arises, we must study the background and big logic behind it. The future competition can be described as military competition, economic development competition and financial competition, but it can also be said that the competition between thought and calculation . Closing mines is easy and preventing the trend is harder.