As the Chinese government continues to celebrate the massive decline in cryptocurrency markets this year, a local blockchain expert called for a Ponzi scheme cryptocurrency.
Yifan He, CEO of Red Date Technology – a major technology company involved in the development of the flagship blockchain project in China, known as Blockchain Service Network (BSN) – has written a new article dedicated to the different types of cryptocurrencies and their supposed Ponzi scheme.
Published in the local newspaper The People’s Daily on Sunday, the article calls private cryptocurrencies “the largest Ponzi scheme in human history.”
The author cites the collapse of Terra network, with the native Terra token (LUNA) – now known as Luna Classic (LUC) – falling 99% and the algorithmic stable TerraUSD Classic (USTC) crashing its pins to the US dollar in a month of May. 2022. He also criticized the increasingly popular concept of virtual currency known as X-to-earn, referring to move-to-earn or play-to-earn projects, calling this model a “phishing strategy”.
BSN Chairman also cited some well-known criticism of Microsoft founder Bill Gates and legendary investor Warren Buffett of bitcoin (BTC).
He is not a fan of bitcoin or any other similar cryptocurrency. “Currently all unregulated cryptocurrencies, including bitcoin, are Ponzi schemes, based on my understanding, with varying levels of risk based on market capitalization and number of users,” he said in a statement.
The chairman of the BSN also said that he never had a portfolio of cryptocurrency or related assets: “I will not and will not touch them in the future, even if they become controlled, because I do not think that they have any. value ”.
According to He, governments like El Salvador – which has chosen to accept BTC as a legal tender – “are in dire need of basic financial training.” “Otherwise, they endangered entire countries, unless their original intention was to build state – owned cryptocurrency exchanges and scam their citizens,” the executive told Cointelegraph.
Criticizing bitcoin and many other crypto projects, he still believes that some of the cryptocurrency market could do very well if properly regulated. Stables with financial support such as Tether (USDT) and Circle’s USD Coin (USDC) should not be viewed as Ponzi-type schemes, the BSN Chairman said, arguing:
“USDC or USDT are payment currencies, not speculative assets. When fully controlled, they will be fine ”.
It previously came out in favor of stablecoins in 2020. The leader once planned to integrate stable coin payments into the BSN from 2021. The plan was eventually scrapped due to China’s hostility towards cryptocurrencies.
Also Read: China warns Bitcoin will crash completely, but BoE sees the White Side
The news comes as the Chinese government takes advantage of the current crash in the cryptocurrency market to defend its multiple ban on the sector. The most recent coordination ban was enacted in September 2021, and numerous Chinese authorities have taken measures to ban all types of crypto transactions in the country.
Despite all efforts, China remains a leading provider of bitcoin mining worldwide. According to data from the Cambridge Bitcoin Electricity Consumption Index, China was the second largest hashrate producer from BTC mining after the United States in January 2022.
