The wave of cryptocurrency investment has swept the world and has become the new favorite of investors in the financial industry. However, due to the anonymity and cross-border nature of capital flows, which endangers the CCP’s regime and surveillance, digital currencies have been repeatedly suppressed by the CCP in China. After being away from the CCP, Zhao Changpeng, the founder of the virtual currency trading platform Binance, became one of the top ten richest people in the world with a value of US$90 billion in just four years, becoming the richest man in China.
On November 4 this year, Forbes released the annual list of the richest in Mainland China. The founder of Nongfu Spring, Zhong Sui Sui, won the top spot in the 2021 rich list in Mainland China with a wealth of 424.4 billion. Less than a month later, according to a report by Lu Media’s Caijing, the richest Chinese have changed ownership. With a wealth of RMB 573.3 billion, Zhao Changpeng, the founder of the virtual currency trading platform, has become the new richest Chinese, and has also become one of the top ten richest people in the world.
According to media reports, Binance has only been established for 4 years and has become the world‘s largest cryptocurrency exchange, with 3,000 employees worldwide, daily trading volume of 76 billion U.S. dollars, and a company valuation of 300 billion U.S. dollars.
According to this calculation, Zhao Changpeng, the founder of Binance, who holds 30% of the shares, is worth US$90 billion, equivalent to RMB 573.3 billion.
However, Zhao Changpeng’s success is quite ironic to the CCP, because his company grew by “escaping from the CCP.”
Zhao Changpeng, 44, immigrated to Canada with his family when he was a teenager. After graduating from university, he entered the Tokyo Stock Exchange, Bloomberg Co., Ltd., and Shanghai to establish Fuxun Information Technology Co., Ltd. to develop software systems. In 2013, he started to contact cryptocurrency and served as the main technical person in charge of wallet and block data query service provider Blockchain. Later, he joined Beijing Lekuda Network Technology Co., Ltd. as the chief technology officer of OKCoin. Invested in Bitcoin in 2014 and left OKCoin in 2017 to establish Binance. In less than eight months, Binance became the world‘s largest virtual currency trading platform.
In September 2017, the Binance Exchange encountered CCP’s compulsory supervision soon after it opened. Many departments of the Chinese Communist Party jointly issued the “Announcement on Preventing Token Issuance Financing Risks”, which prohibits engaging in token issuance financing activities. On the same day, Binance announced that it would no longer provide virtual currency transaction services to users in mainland China. As a result, Changpeng Zhao moved to Singapore to expand overseas markets and became the richest Chinese man in just four years.
Binance users can now be seen in various countries. According to a report by CNBC, Afghan refugees in political turmoil would rather exchange local currency for virtual currency, store it in a Binance account on their mobile phone and then flee.
Since Bitcoin became the first decentralized cryptocurrency in 2009, after more than ten years, there have been more than 2,000 cryptocurrencies in the world, and their development and changes have rapidly exceeded imagination.
The Associated Press stated that advocates of cryptocurrency believe that this currency has the advantages of anonymity and flexibility, but the Chinese Communist Party’s regulators worry that this currency will weaken the CCP’s control of the financial system because the CCP’s central bank cannot track the flow of funds.
Therefore, as early as 3 years ago, the central bank had banned the trading of cryptocurrencies in the country and prohibited financial institutions from providing services for such transactions.
On May 18 this year, the Chinese Communist Party’s regulatory agency announced that financial institutions and payment companies cannot provide related services for cryptocurrency transactions. Subsequently, the three major associations of the Communist Party of China (China Internet Finance Association, China Banking Association, and China Payment and Clearing Association) also issued a statement on the same day that the cryptocurrency transaction hype activities seriously violated the “people’s property security” and disrupted the normal economic and financial order.
On May 21 this year, Liu He, Vice Premier of the Communist Party of China, announced at a meeting of the Financial Stability and Development Committee to crack down on Bitcoin mining and trading.
On September 24, the Central Bank of the Communist Party of China issued a notice again announcing that virtual currency does not have the legal status equivalent to legal tender. Any virtual currency-related business activities such as exchange, trading, provision of matching services, token issuance financing, and derivative transactions are illegal Financial activities are strictly prohibited and banned; at the same time, the provision of services by overseas virtual currency exchanges to Chinese residents through the Internet is also regarded as illegal financial activities.
Many currency experts say that safeguarding the self-interest of the CCP is the driving force behind the CCP’s suppression of virtual currencies.
In recent years, the Central Bank of the Communist Party of China is developing a traceable digital renminbi. The Chinese Communist Party wants to allow the Chinese people to use the financial system it can control.
Yang Cong (pseudonym), a veteran mainland industry insider, told The Epoch Times that the CCP is afraid of cryptocurrencies for three reasons. First of all, cryptocurrency is the mortal enemy of totalitarian countries. Its decentralized nature makes it impossible for the CCP to manipulate the exchange rate, currency issuance, or inflation and deflation to plunder the people.
In addition, cryptocurrency has the characteristics of freedom, democracy, and reality, and may therefore rebuild a new social order and social structure. This can be said to have moved the foundation of the CCP.
Secondly, the Central Bank of the Communist Party of China announced in October last year that it would implement the digital renminbi, and it plans to operate during the 2022 Winter Olympics. It has now begun to implement it in domestic financial institutions. In order to ensure that the officially issued digital renminbi is the only one, it is also the main reason for the crackdown on cryptocurrencies.
Furthermore, a large amount of renminbi or U.S. dollar reserves, in order to seek a safe haven, borrowed the anonymous and anti-counterfeiting features of cryptocurrency to flow overseas. This is also the CCP’s concern.
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