LATEST FROM PUTIN AND XI SUGGESTS GROWING POLITICAL INTEREST IN BITCOIN
On February 4, a local news source reported that Russian President Vladimir Putin had written to the Chinese people, detailing current commerce and mutually beneficial infrastructure projects.
Presidents Xi Jinping and Putin met in Beijing ahead of the start of the 2022 Winter Olympics and had a heated discussion. Following that meeting, the leaders issued a joint statement confirming Russia’s support for China in its Taiwan conflicts, expressing concern about an Australian-led defense alliance, and criticizing NATO expansion.
Residents who are threatened with arrest may turn to bitcoin
One issue, among the many that these two leaders are drawing in the sand, may be a hint of future attitudes toward Bitcoin. It’s not unexpected that Russia and China are looking to form commercial and scientific development alliances given their recent history of political tension and the threat of economic sanctions.
According to Putin, “we are constantly extending settlements in national currencies and devising measures to mitigate the harmful impact of unilateral sanctions.” In 2019, the Russian and Chinese governments signed an agreement on payments and settlements, which was a significant milestone in this process.
There had already been a threat made to cut Russia off from SWIFT just a few days earlier. Russia has a treasure mine of foreign reserves worth more than $600 billion, which puts it in an ideal position to escape sanctions.
Is one or both of the superpowers interested in pursuing a strategy of widespread Bitcoin adoption as a result of these actions?
It doesn’t appear to be a far-fetched possibility. As Bitcoin Magazine revealed late last month, the Russian Central Bank had proposed a ban on Bitcoin, but Putin (supported by other government officials) resisted, arguing that Russia stood to gain from bitcoin and mining. Belarus, on the other hand, has expressed interest in retaining its policy of openness for bitcoin just one day earlier.
READING BETWEEN THE LINES
We need to read between the lines to increase the likelihood of bitcoin’s implicit interest even more. During the current energy crisis, both China and EU countries have come under fire. China has been experiencing a severe drought this winter, prompting the government to issue warnings about unexpected and unannounced reductions in water supply. Yunnan province is particularly hard struck by drought-related hydropower output reductions in Guangzhou, the Guangdong metropolis and major Guangdong power supplier. In terms of trade, Guangdong is hailed as China’s “powerhouse”. President Xi has a dilemma if the electricity supplier for such an important commerce source has a problem.
In light of this, the following passage from Putin’s letter stands out:
“Our countries are forming a good energy alliance. Many major cooperative projects are in the works, as well as long-term oil and gas deliveries to China. Russia’s Rosatom State Corporation has participated in the construction of four new power units at Chinese nuclear power facilities, which was launched last year. All of this considerably enhances China’s and the Asian region’s energy security.”
Bitcoin mining provides incentives for increased and robust electricity production (from all sources), including the environmental benefits that bitcoin mining generates by offering a use case for flare gas. Putin appears to understand this.. On top of that, the censorship-resistant nature of bitcoin may have made it desirable in the face of Western threats to cut Russia off from the SWIFT network.
Finally, the network’s decentralization is at the heart of it all. The total number of Bitcoin nodes that can be reached around the world is rapidly nearing the intimidating figure of 15,000, which is quite a challenge. According to this estimate of nodes that have not been obfuscated by Tor or other privacy methods, there are certainly many more nodes than this amount, but we don’t know exactly how many there are.
More countries are expected to show interest in Bitcoin as it continues to demonstrate its value to the rest of the globe. We’ve only just begun the second month of the year, so buckle up, Bit coiners.
Mike Hobart has written a guest post for us. Bitcoin Magazine and BTC Inc. do not necessarily agree with the views stated in this article.