Is Bitcoin Political?

  • 2023 Oct 05

Bitcoin is increasingly becoming a focal point in global politics, especially in the wake of El Salvador’s decision to embrace it as legal tender. President Nayib Bukele led the charge, implementing this significant shift despite criticism from various quarters, including his own citizens, the Bank of England, the IMF, Vitalik Buterin, and many others. Since the enactment of the Bitcoin legal tender law in September 2021, Bukele has even unveiled ambitious plans for Bitcoin City, a metropolis powered by geothermal energy from volcanoes and entirely centered around Bitcoin mining.

While there have been speculations about other countries like Mexico and Russia considering similar moves, El Salvador remains the solitary pioneer in this regard.

Conversely, countries like China have taken a stern approach to curbing Bitcoin mining and trading activities. In May 2021, the Chinese government declared all crypto-related transactions illegal, followed by a widespread crackdown on Bitcoin mining operations. This crackdown prompted numerous crypto-related businesses to seek refuge in more crypto-friendly regions.

Interestingly, despite China’s anti-crypto stance, the country continues to play a significant role in the Bitcoin ecosystem. According to data from the University of Cambridge, China ranks as the second-largest contributor to Bitcoin’s global hash rate, trailing only behind the United States.