Hashkey Group CEO Xiao Feng believes a pro-crypto Trump administration could pressure China to soften its stance on Bitcoin (BTC) and other digital assets.
In an interview with the South China Morning Post, Feng expressed confidence that China’s crypto market will eventually open up, especially if President Donald Trump and the US Congress adopt supportive policies for digital assets.
Trump’s influence
Feng argued that clear and consistent US crypto regulations would push China to reconsider its approach. He said:
“If the US Congress and the President take proactive steps to clarify crypto regulations, continue to legislate and advocate for the industry, this would certainly encourage China to accept crypto.”
Trump has made digital assets a central issue in his 2024 campaign. He has pledged to fire Securities and Exchange Commission (SEC) Chairman Gary Gensler on his first day in office and reverse policies that, in his view, undermine innovation suffocated in the crypto industry.
The newly elected US president has also proposed halting the sale of the US government’s seized Bitcoin and strategically holding it as an investment asset.
Feng’s comments suggest that, if implemented, these policy changes could change China’s historically negative attitude toward crypto.
Stablecoins could pave the way
China maintains strict regulations on digital assets after banning initial coin offerings (ICOs) in 2017 and cryptocurrency trading and mining in 2021.
However, Feng suggested that China could eventually open its market to regulated stablecoins – digital currencies tied to real-world assets – to facilitate cross-border trading.
According to Feng:
“Stablecoins offer the best solution for cross-border trade between businesses and consumers.”
Stablecoins are increasingly recognized for their potential to improve cross-border payments by offering faster, more cost-effective and transparent alternatives to traditional methods. Its introduction is seen as a significant advancement in the global financial landscape.
Its use has increased significantly this year, especially in emerging and developing countries facing high inflation and economic uncertainty.
By mid-2024, the cumulative market capitalization of stablecoins reached approximately $165 billion, facilitating trillions of dollars in transactions annually. Notably, more than 20 million blockchain addresses are involved in stablecoin transactions every month, highlighting their increasing role in daily financial activities.