Kevin O’Leary, co-host of an investment television program called Shark Tank, stated that large professional investors do not want to own «Chinese» Bitcoin – or as he called it «blood coin».
During a regular online conference from the Chicago Board Options Exchange (CBOE), O’Leary noted that the more major market players accumulate bitcoins, the more questions will arise about the true origin of the coins.
Let’s start with an explanation. Sometimes Bitcoin is really called the «Chinese cryptocurrency», since the largest computing power for mining BTC is concentrated in this country. We checked the data: at the end of 2020, China accounted for 65 percent of the total hash rate of the first cryptocurrency network.
At the same time, the United States is in second place with a result of 7.24 percent, followed by Russia with 6.9 percent.
Bitcoin network hashrate in 2020
However, it is important to understand that the concentration of computing power does not mean that Bitcoin belongs to a particular country. Of course, China gets more BTC from the mining of cryptocurrency, but the network of the first coin is decentralized and independent of any political factors.
What can stand in the way of Bitcoin?
O’Leary refers to the fact that most of the new BTC is mined in countries with serious violations of human rights. Here is a quote from him, in which he shares his attitude to the situation. The cue is from Decrypt.
The real challenge is compliance and sustainability, as well as other issues, for example, is this coin mined in countries that violate human rights, or are they being sanctioned? And I’m really talking about China. Many representatives of investment organizations have told me that they do not want to own the «Chinese coin».
We believe that such investors do not understand the features of decentralization in the example of the cryptocurrency network and do not know where the Bitcoin nodes are located, which confirm transactions in the BTC blockchain. In general, the claims that Bitcoin belongs to China can be considered another myth about the cryptocurrency.
Kevin O’Leary
The expert noted that he is now actively looking for miners outside of China, which is quite difficult, since most of this industry is concentrated in the PRC. Ultimately, the investor wants to attract others to own «ethically mined bitcoins.» Kevin continues.
If you do not want to own a Chinese coin, also called a «blood coin» (just like blood diamonds), you must know the origin of bitcoins.
O’Leary is ready to go even to extreme measures – to pay an increased price for «ethically mined bitcoins». He is confident that cryptocurrency can only find acceptance in the world if it becomes «ethically and morally compatible.»
Recall that earlier Kevin was a sharp opponent of Bitcoin, but relatively recently he changed his mind about the digital asset and even invested part of his capital in BTC and Ethereum.
Rating of the largest institutional Bitcoin holders
The question of the «ethics» of mining, it seems, did not concern those companies that were actively buying bitcoins the day before: we are talking about Square, Tesla and MicroStrategy. And it is unlikely that O’Leary’s assumption will become such a serious problem if organizations can make huge money on the crypto market.
A striking example of this is the investment of 5 percent of its capital in Bitcoin by the KiwiSaver Growth Strategy pension fund. The fund’s chief investment officer, James Grigor, cited the similarity of BTC to gold as one of the reasons for this decision by the organization’s management.
Bitcoin mining in China really relies on cheap electricity generated from environmentally harmful sources. The PRC is also not the best country in terms of observing human freedoms. However, for most of the history of the crypto market, China has remained the mining center of the whole world and this situation is unlikely to change in the coming years.
However, there is some truth in O’Leary’s words: bitcoin mining really needs to be «taken out» outside China in order to make the industry more decentralized on paper. And miners all over the world are now doing just that – of course, for selfish purposes.
We believe that this point of view does not intersect with reality. Yes, there are really a lot of miners in China, which is caused by the serious production of ASIC miners in the country and cheap electricity. However, in fact, nothing prevents other states from changing this situation and increasing their own share in the network hashrate distribution graph. However, there is no serious need for such a thing, since Bitcoin will be decentralized without it.
