it is inevitable that China buys Bitcoin (BTC)

According to the famous co-founder of Binance Changpeng Zhao, better known as CZ, it would be inevitable that China sooner or later invests in BTC. 

CZ yesterday spoke at the Bitcoin MENA conference in Abu Dhabi, where he was interviewed by David Bailey.

He talked about many things for about half an hour, answering several questions. 

China and BTC

According to CZ, smaller countries will probably be the first to adopt Bitcoin, as indeed the small El Salvador has already done. 

However, the co-founder of Binance believes that this evolution will not end there, even if the change should happen slowly.

In light of this, it was stated that China will be one of the countries to adopt a strategic reserve in Bitcoin, probably following in the footsteps of the plan proposed by the new president Trump.

The new president will take office only on January 20, so for now nothing is certain yet, but it seems absolutely likely that he will keep the promises made during the election campaign and activate the strategic reserve in Bitcoin.

CZ has suggested that, as soon as it is activated, other countries might follow suit. 

Furthermore, it highlighted how China’s position on cryptocurrencies is difficult to predict due to the lack of transparency from its government. On the other hand, what the Asian giant has done so far in this regard leaves a bit uncertain and perplexed, given that in 2021 it banned crypto trading, while in 2024 it allowed the launch of spot ETFs on BTC and ETH on the Hong Kong stock exchange. 

CZ and China

Changpeng Zhao is Chinese, born in China in 1977. 

At the age of 12, however, he moved to Canada, and later became a Canadian citizen. 

In 2005, he returned to China, to Shanghai, to found a tech startup that dealt with trading platforms. 

In 2013 he sold his apartment in Shanghai and used the amount collected to invest in Bitcoin. Later he developed, together with others, the famous site blockchain.info, and became the CTO of OKCoin.

In 2017 he co-founded Binance, which at the time was based in China. 

However, Binance already began its expansion abroad in 2017, precisely to escape the first Chinese bans on crypto. In fact, it has not been a Chinese company since then. 

CZ, however, knows China very well, not only because he is a Chinese born in Jiangsu, but because his first major professional successes were achieved in Shanghai. 

However, being also a Canadian citizen, once Binance moved away from China, CZ did the same, to the point of being even ended up in prison in the USA for violating several of Binance’s own federal laws in the United States.

After a few months in prison, he was released from prison, and he began to travel the world as an evangelist of the crypto sector.

The Bitcoin reserves of the USA

To understand his reasoning, it is necessary to start from Trump’s idea. 

The USA government, through the Department of Justice, holds about 200,000 BTC. 

These are Bitcoins seized from criminals during various investigations by the Department of Justice itself. 

Generally, the seized BTC are auctioned to the highest bidder, but since 200,000 BTC is not a small amount, Trump has suggested not selling them and keeping them as a reserve in the State’s accounts. 

To tell the truth, until a few days ago there were 220,000, and 20,000 have been moved by the current Biden administration probably to be sold. 

The idea of Trump, on the other hand, is not to sell them anymore, and to use them as a strategic reserve. Currently, 200,000 BTC have a value of almost 20 billion dollars, so even though it is not a significant amount, for example compared to the 36 trillion dollars of their public debt, it is not a small thing either. 

Furthermore, Republican Senator Cynthia Lummis stated that she intends to propose to Congress to purchase 200,000 BTC per year for the four-year duration of the Trump administration to have the USA own one million BTC. 

The Bitcoin (BTC) of China 

China also already holds Bitcoin, again thanks to judicial seizures. As far as is known, it holds about 190,000.

However, the Chinese government has never publicly expressed the intention to keep them as a reserve. 

However, if Trump were to actually activate the strategic reserve in BTC, and especially if the USA were to start purchasing Bitcoin, it is indeed quite difficult to imagine that China could realistically stay out of it. 

Furthermore, the 190,000 BTC that are reported to be in the possession of the Chinese government were acquired in January of this year and have not yet been sold. Although these dynamics often take a long time (even several years), it is possible to imagine that the Chinese government may have at least already considered the possibility of keeping them. 

Therefore, CZ’s hypothesis is not at all absurd, even if there is a significant difference between holding in reserve the BTC already acquired through judicial seizures and buying them on the market. However, CZ’s reasoning does not only concern the current state and its evolution over the next 4 years, but also concerns the long-term evolution.