When the US sets up a Strategic Bitcoin Reserve it generates concern about China creating its own national digital currency initiative. 

The U.S. President Donald Trump established a Strategic Bitcoin Reserve and a Digital Asset Stockpile on March 7 through executive order. The United States policy transformation sparks uncertainty about what impact it will have on China as a major global power.

According to Bitcoin supporter David Bailey the Chinese government already started planning how to deal with Bitcoin since before the upcoming US elections. Official updates about Beijing’s bitcoin strategies have not appeared in public yet.

China’s Possible Bitcoin Holdings

When China may have kept the 195,000 BTC from its 2020 seizure of PlusToken Ponzi scheme funds since then their reserves would match or exceed the 198,109 BTC held by the United States government valued at $17 billion. The U.S. views Bitcoin as long-term value storage and pursues budget-neutral buying strategies but China has not revealed its Bitcoin management plans.

The Yancheng Intermediate People’s Court decided PlusToken case profits must go to national funds. People do not know right now if the government still retains those assets or has already converted them into cash. According to CryptoQuant CEO Ki Young Ju China disposed all its Bitcoin holdings because the Communist Party detests owning censorship-proof digital money. 

Future of China’s Bitcoin Policy

Information about these assets still needs official verification to become known. The world would see China taking its place as one of the biggest Bitcoin owners when it chooses to establish its own Bitcoin holdings like the United States. China may take a new path with Bitcoin that could reduce US market dominance in the digital asset realm.

Different Hong Kong legislators analyze the possibility of Bitcoin usage within their separate administrative structures under Chinese rule. Wu Jiexhuang suggested to the Hong Kong Legislative Council the need to analyze how U.S. Bitcoin ETFs affect Bitcoin markets on Dec. 30. 

He expressed that putting Bitcoin in the category of strategic assets would affect worldwide financial markets according to his observations. The United States’ Bitcoin reserve strategy now requires China to decide if state-backed cryptocurrency reserves should be part of their financial strategy or remain separate. Decisions about Bitcoin will change its position in the finance world and shape its future worldwide.