Hong Kong could be key for China’s crypto comeback: Arthur Hayes
Arthur Hayes, the former CEO of crypto derivatives giant BitMEX, believes the next crypto bull run will start when China moves back into the market, and Hong Kong has a vital part to play in this process.
In his Oct. 26 blog post titled "Comeback", Hayes outlined why he thinks the Hong Kong government's announcement about introducing a bill to regulate crypto is a sign China is trying to ease its way back into the market. This could be because Hong Kong acts as “the proxy through which China interacts with the world."
Hayes argued that Hong Kong may become the testing ground for Beijing to experiment with crypto markets and act as a hub for Chinese capital to find its way into the global crypto markets.
According to Hayes, Hong Kong’s “reorientation as a pro-crypto location” is a prong in Beijing's strategy to reduce its position in a way that won't destabilize its internal financial system.
Hong Kong was ranked the best-prepared country for widespread crypto adoption in a study by Forex Suggest published in July 2022. It considered several factors like crypto ATM installations, pro-crypto regulations, and startup culture.
China has one of the largest economies in the world but has been mostly hostile toward the crypto industry. The country's first ban came way back in 2013 when it prohibited banks from handling Bitcoin (BTC) transactions.
Beijing ramped up its crypto crackdown efforts in 2021 when it carried out multiple regulatory operations to eradicate Bitcoin mining from the country and deemed all crypto transactions illegal.
However, Hayes says "China has not left crypto — it has just been dormant."
Related: Possession of Bitcoin still legal in China despite the ban, lawyer says
China did resume BTC mining operations in
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