China is banning crypto — again. And markets are selling off hard in response. It’s deja vu all over again.
It reminds me of a great quote from venture capitalist Fred Wilson: “The lesson from the internet is, anything that China bans, invest in it.”
Here’s a nice graphic demonstrating that theory, posted by Dan Morehead of Pantera Capital on Twitter.
Investors who sell on China “bans” usually end up bummed… pic.twitter.com/OKlBe9yU9q
— Dan Morehead (@dan_pantera) May 26, 2021
The Chinese government is clearly intimidated by crypto — just like it is intimidated by Western tech companies. The reason is simple. Crypto and big tech have the potential to disrupt the Chinese government.
So the fact that China is — once again — ramping up the crypto bans emphasizes the massive potential of these assets. It’s telling that one of the most powerful governments on earth is terrified of them.
My only concern is that with authoritarian tendencies rising in the US, we could potentially follow China’s lead in a few years. I hope that doesn’t happen, but we can’t rule anything out at this point. It wouldn’t surprise me to see someone like Elizabeth Warren lead a charge against crypto.
The good news is that around 15% of the American population owns crypto at this point. That makes us a powerful contingent. As long as we stand up for our rights, we should be fine. Let’s make sure we all do our part.