The recent developments in China got me to thinking about the old "What if all governments ban bitcoin?"
It seems natural that this question would come up again- since really, all governments should ban bitcoin in their best interest. In its logical extreme, it removes one of their main sources of power, which is issuing national currencies, enhances free trade by removing barriers to trade associated with financial institutions and related tax revenue, and also increases the risk of international trade going around tarriffs- particularly with digital products, information, and services. The problem is, which US authorities have figured out fairly quickly, you can ban bitcoin, but you can't stop it. Maybe the US's favorable attitude also comes from the government having considerable BTC holdings...
Anyway, it looks to me like China's move against bitcoin is a defensive one defending the yuan. They have been gearing up to
unleash the yuan onto the global stage, and don't need a decentralized, non-governmental currency competing with the yuan in the domestic market. Obviously, bitcoin is innately superior to fiat currency and they want to prevent what essentially could become a run on the yuan in favor of bitcoin.
I see this move as similar to India's ban on gold experts. I see an explosion in India in bitcoin in the near future similar to the Chinese explosion as quite likely, and a government ban similar to China's as quite likely as well.
I see this as good for bitcoin.
This article cites the global shadow economy at roughly $10 trillion. It also says that it is growing fast.
This has probably already been discussed on this forum and maybe someone can post a link to that discussion. Supposing bitcoin becomes the official currency of the shadow economy, a $10 trillion dollar market cap (assuming no contact with the on the books economy) would yield a one dollar satoshi valuation.
That bitcoin could be adopted even by vegetable sellers in a market in Bolivia given the right interface is attested by the
rise of mobile payments in East Africa.
Just saying why regulatory concerns don't really worry me in terms of long term viability of bitcoin.
