The grievances of the Chinese cryptocurrency community

In 1986, a baby boy was born in Shaoyang, Hunan.

Don’t get me wrong, this baby boy was not one of the top five handsome bloggers in China - Daniel Lu, but the richest man in Hunan - Fried Cat (Jiang Xinyu).

It is no exaggeration to say that he is the richest man in Hunan.

According to incomplete estimates, there are 74,715 bitcoins in the two known bitcoin wallets of FC. Based on the peak price of nearly US$100,000 per bitcoin in November 2024, FC's assets are 54.9 billion yuan, making him the richest man in Hunan.

However, FC probably didn’t live to see the day when he became the richest man.

FriedCat has been a top student since he was young. In 2001, at the age of 15, he was admitted to the Junior Class of the University of Science and Technology of China with a score ranking 11th in the country, becoming the pride of all of Shaoyang. To this day, his name is still on the honor roll of his alma mater, and he is admired by his juniors.

In 2009, 23-year-old Jiang Xinyu published a paper entitled "Building a Secure Thread Mechanism with Formal Methods", graduated with a master's degree, and went to Yale University for a visiting scholar and doctoral program in 2011.

No one knew that this trip of Kaomao would bring about a huge revolution in the Chinese Bitcoin market.

Speaking of Bitcoin, it can be traced back to a small circle that was born in 1992.

This year, a crypto-anarchist group was born. At a gathering, Timothy May, an electronic engineer at Intel, published the Crypto-Anarchist Manifesto, formally proposing the concept of crypto-anarchism.

The first sentence of the declaration seems familiar to us:

“A spectre is haunting the modern world – the spectre of crypto-anarchism.”

The core idea of ​​crypto-anarchism is to protect privacy and political freedom by applying cryptographic software to avoid harassment, monitoring and reporting when sending and receiving information on computer networks.

With religious piety, they decided to create a new digital technology with decentralization as its spiritual core and the SHA256 algorithm as its foundation to fight against state regulation and commercial monopoly in modern society.

They firmly believe that this technology can subvert human society:

“Computer technology is on the verge of enabling individuals and groups to communicate and interact with each other in a completely anonymous manner.

… Combined with emerging information markets, crypto-anarchy will create a liquid market for all material that can be expressed in words and pictures.

Get up, crypto-anarchists, you have nothing to lose but your barbed wire fence!"

Although this view may sound like the wishful thinking of idealists, in fact, they have really changed our lives.

Because Sir Tim Berners-Lee, the inventor of the World Wide Web, Bram Cohen, the author of BT download, Sean Parker, one of the founders of Facebook, Julian Assange, the founder of WikiLeaks, and many others are all members of this group.

Of course, this also includes Satoshi Nakamoto, the founder of Bitcoin.

Who is Satoshi Nakamoto? No one knows. Until now, computer genius hackers and intelligence organizations from all over the world have failed to uncover the true identity of Satoshi Nakamoto, so much so that some people suspect that Satoshi Nakamoto is a time traveler from the future.

It has to be said that Satoshi Nakamoto has not revealed his mysterious identity until now, which is very crypto-anarchist.

In 2008, the global financial crisis broke out. On November 1 of the same year, Satoshi Nakamoto published his white paper "Bitcoin: A Peer-to-Peer Electronic Cash System", telling the world: "I am developing a new electronic currency system that is completely peer-to-peer and does not require the intervention of a trusted third party."

At this point, an electronic currency that cannot be manipulated by any political or financial force - Bitcoin, began to become known.

This means that crypto-anarchists can have their own central bank and build their own financial system.

In order to verify his theory, at 18:15 on January 3, 2009, Satoshi Nakamoto mined the first block of Bitcoin on a small server in Helsinki, Finland, known as the "Genesis Block", and received the first mining reward - 50 bitcoins.

At this point, Bitcoin was officially born, and Satoshi Nakamoto became the "Creator".

Satoshi Nakamoto soon announced the mining algorithm, and a group of technical geeks began to mine on servers at various universities, and the number of bitcoins increased rapidly.

But the question soon arises: how to prove that Bitcoin has the function of currency? In other words, how to prove that Bitcoin can buy things?

On May 18, 2010, a cryptographer named Laszlo Hanyecz from Florida, USA, posted a message online, offering to buy two pizzas for 10,000 bitcoins on the condition that they meet in person to trade.

You heard it right, 10,000 bitcoins, based on the current market value, is worth about 7 billion RMB.

But at that time, everyone thought it was a joke and no one paid any attention.

It was not until four days later that a British man, thinking that “two pizzas are better than nothing”, ordered two pizzas and sent them to Hanyez’s home, and received the 10,000 bitcoins. Laszlo quickly ate the two pizzas worth 7 billion yuan.

Since then, May 22nd of each year has become "Bitcoin Pizza Day" in the cryptocurrency world to commemorate the first commercial transaction of Bitcoin.

After the pizza incident, the value of Bitcoin began to be recognized by the world, Bitcoin transactions were born, and the price began to rise.

Soon, this way to make money was noticed by the Chinese.

Interestingly, the first group of people in China to come into contact with Bitcoin were not the most technology-sensitive geeks in universities, but the non-mainstream people with messy hair in small towns:

Game leveling.

In 2010, the most popular game in China was "World of Warcraft". Behind World of Warcraft, there is an entire industry chain of power leveling, competition, gold farming, equipment farming, dungeon farming... Countless non-mainstream teenagers could get dozens of yuan in hard work fees for staying up all night. If they were lucky, they could get good equipment and sell it for hundreds or even thousands of yuan.

Suddenly, in some QQ groups for power leveling, there appeared some advertisements for recruiting people to mine. You only need to install a piece of software, and the computer will automatically mine, which generally does not affect your game playing. Then you can get coins the next day, and then sell the bitcoins to the collectors at the price of 2-3 yuan per coin. Generally, you can mine 10 bitcoins in one night, which is at least enough for a day's food.

Thus, Bitcoin was developed and promoted in a very down-to-earth way in the hands of a non-mainstream group in China who knew nothing about crypto-anarchism.

These non-mainstream people in strange costumes have no idea that the string of code they casually sold will become so priceless in the future.

However, these first generation miners soon faced a business crisis because mining technology was innovated in late 2010.

According to Satoshi Nakamoto's design, Bitcoin is in a utopian ideal state where "everyone is the central bank", so anyone with a CPU can mine. All you need is an ordinary computer and a piece of software to start your mining journey.

However, this decentralized situation was soon broken because GPU entered the industry.

We all know that mining is highly dependent on computing power. In the beginning, everyone used CPU for mining, but with the in-depth study of mining algorithms, everyone found that mining was just repeating the same work, and the CPU, as a general-purpose computing unit, was not good at parallel computing at all. It could only execute a dozen tasks at most at a time, and mining was too slow.

In contrast, GPUs have thousands of stream processors, are inherently suitable for mining, and are obviously more efficient.

Satoshi Nakamoto did not agree with GPU mining at first. He even proposed to reach a gentleman's agreement to artificially limit GPU mining in order to maintain a "fair state" in mining.

However, Satoshi Nakamoto still underestimated human nature.

When Bitcoin has value, naturally someone will want to make money from it.

As Hanyez open-sourced his optimized algorithm for mining based on graphics card GPUs (now you know why he has 10,000 bitcoins, right?), the computing power of the entire Bitcoin network has grown exponentially, with the unit quickly jumping from MH/s to GH/s. Originally, a maximum of a dozen bitcoins could be mined a day, but after using GPUs, mining output has increased dramatically, and producing hundreds of bitcoins a day is no longer a dream.

As a result, China's non-mainstream people began to flock to Internet cafes with good graphics cards, leaving the Internet cafe owners confused. This indirectly led to the first large-scale upgrade of graphics cards in China's Internet cafes, and also solved Huang Xiaoming's Nvidia crisis.

Graphics card mining has been popular for two years and is facing challenges again.

In June 2012, the American Butterfly Labs successfully developed the ASIC mining machine, bringing about a new mining revolution.

ASIC mining machine uses ASIC chip as the core of computing power. Simply put, it is an ASIC chip customized for Bitcoin's SHA256 algorithm, which can bring higher performance, lower energy consumption and smaller size.

Let's compare the current high-end 4090 graphics card, after optimization, the mining capacity is 129.8MH/s, the power consumption is about 322W, and the mining machine Antminer S9? The mining capacity is 13.5TH/s! It is several orders of magnitude higher!

Whoever owns a mining machine has the power to “mint coins”.

At Yale, FriedCat heard about the research and development progress of the Butterfly Lab and keenly smelled the opportunity to make money.

The generation born in the 1980s grew up reading Readers of the West. Readers of the West once told a story about the San Francisco Gold Rush era. Because the competition was so fierce, few gold diggers made any money, but those who "sold shovels" to them at the mine made a fortune.

Grilled Cat thought, why can't I be the one selling shovels?

Therefore, almost at the same time as Butterfly Lab’s successful development, Friedcat posted a message on the Bitcointalk forum under the ID Friedcat, claiming that it had the ability to develop mining machines and publicly raise funds from the community.

According to BakedCat's financing plan, he dropped out of Yale and founded BitQuan Information Technology Co., Ltd. The company's equity was divided into 400,000 shares, each worth 0.1 bitcoin.

No one realized that this was the first ICO (Initial Coin Offering) in the history of the world's cryptocurrency circle.

FriedCat not only raised funds online, but also held roadshows to promote its mining machines. In the end, FriedCat successfully raised 16,000 bitcoins, which was about 1 million RMB at the time. The person who invested the most was a 26-year-old young man named Wu Jihan, who invested a total of 15,000 bitcoins.

Things become easier if you have money. The development of Kaomao's mining machine went very smoothly. In just two months, it launched its own product - the first generation of Kaomao mining machine.

FriedCat took the first generation of mining machines and set up a mining farm in his company’s warehouse for trial use. As soon as the machines were turned on, they accounted for 51% of the world’s Bitcoin computing power!

In other words, at least in early 2013, 51% of the world's newly produced bitcoins were from BBQ!

At its peak, the number of bitcoins mined by the "Baked Cat Mine" in a month reached more than 40,000!

The huge success of the FriedCat mining machine has triggered a collective panic in the currency circle. After all, there are only 21 million bitcoins in total, and they have all been mined by FriedCat. What will others mine?

As a result, hacker attacks followed one after another.

In order to disperse the hatred, Baked Cat only retained 20% of the computing power of the entire network, and sold all the excess mining machines.

At that time, no mining machine could compare with the Baked Cat. Although the mining machine of the Butterfly Lab was successfully developed, it was not mass-produced. The Avalon mining machine, also developed by Chinese and developed by Beihang University Ph.D. Zhang Nangeng, has not started to supply. Therefore, in the ASIC mining machine market, Baked Cat is the absolute king.

At that time, people from all over the world came to China in droves to buy the BakedCat mining machines. Someone recalled that "some even threw money directly over, picked up the mining machines and ran away, fearing that the mining machines would be snatched away."

Just like that, in half a year, FC earned more than 1 billion yuan, and at that time, FC was only 27 years old.

FriedCat has a dream. He wants an island that does not belong to any country. It has no army and no police. On this island, the currency is Bitcoin. It is a free paradise for crypto-anarchists.

However, before he could earn enough money to buy an island, his dream was shattered.

Mining machines are so profitable that they naturally attracted countless competitors.

In June 2013, the mining machines of Butterfly Labs finally went into mass production. In July, the Avalon mining machines also began to be shipped one after another. But what about FriedCat? Because it could not get TSMC’s 55nm chips, the second-generation mining machines were not successfully developed, causing the computing power of the FriedCat mining farm to drop to 4% of the entire network.

It was not until January 2014 that BBK launched its third-generation mining machine BE300. It was originally thought that it could return to its peak, but this chip suffered a series of burning accidents due to packaging problems, which eventually completely ruined BBK's mining machine journey.

At the end of 2014, FriedCat disappeared and no one ever saw him again, and the 74,715 bitcoins in his bitcoin wallet also disappeared.

The legend of FC has come to an end.

Around August 2017, a total of 17,600 bitcoins were transferred out of FC’s two wallet accounts within a week. On November 12, 2024, FC’s bitcoin account, which had been dormant for seven years, revived again and transferred out another 206.34 bitcoins, worth $18.12 million.

Were these transfers made by FriedCat? Or were they manipulated by others? Is FriedCat still alive? No one knows.

All we know is that the Bitcoin pioneer who wore a wrinkled T-shirt but had a gleam of light in his eyes during the roadshow will never come back.

two

Since FC's company was not doing well, Wu Jihan, the major shareholder who invested in him, had to find another way out.

At this time, Wu Jihan is no longer the rookie who has just started out, but a big boss with tens of millions of assets (dividends from 烤猫).

Because he was optimistic about Bitcoin, Wu Jihan still wanted to do business in mining machines, so he thought of a person - Chang Qian.

Chang Qia is a pen name, not well known to most people, but he is a well-known figure in the science fiction circle.

We all know that Liu Cixin is the number one writer of science fiction in China. From 1999 to 2006, he won the Galaxy Award, the highest award in Chinese science fiction, for seven consecutive years.

So who won the Galaxy Award in 2007 and 2008?

Long spear.

Coincidentally, Chang Qian is also from Hunan. His real name is Liu Zhipeng. He has liked Chu Ci since he was a child, especially Qu Yuan's "Nine Songs", which contains the chivalrous and romantic spirit of "wearing a long Qian, a crown that cuts through the clouds, a moonlit night and a precious jade pendant", so he named himself "Chang Qian".

In reality, Chang Jian is also a passionate idealist. He began to write science fiction novels at the age of 16. "Kunlun", "Highway 674", "The Wound of Fuso", "Dragon Slaying Skills", "If Ma Kai Was Still Alive" and other articles were published one after another, making him famous.

Someone commented: "His works are a mixture of the modern and the historical. His classical works are full of heroic and sad songs, while his modern works gradually reveal the beautiful western wind." After winning the Galaxy Prize, many people regard him as Liu Cixin's successor.

But after 2009, Chang Qia never published any science fiction novels again.

Many people speculated that he had hit a creative bottleneck, but one netizen mysteriously replied on the forum: "Chang Jian is doing something very sci-fi."

That’s right, Chang Jian is doing something very sci-fi—Bitcoin.

As an aside, if we look through the history of China's cryptocurrency circle, we will find that there are a lot of science fiction fans.

For example, Chang Qia, a science fiction writer.

The founder of Xuanlian, “Crazy Xiaoqiang”, is a science fiction writer.

Wu Jihan, the famous "magnet", the chip he developed after working alone, the name of which comes from the English name "Smart".

How much does Wu Jihan like Liu Cixin? When he held the "World Blockchain Conference Wuzhen" in 2018, he even held a cross-border roundtable forum "The Science Fiction World in the Blockchain" for Liu Cixin, just to meet Liu Cixin.

Zhang Jian, founder of Fcoin, also named his "Singer Capital" after "The Three-Body Problem".

etc.

Why do the science fiction circle and the initial coin circle have a high degree of overlap?

Maybe it’s because the two circles have a high degree of consistency. They are both sensitive to technology, emotionally delicate, and like fantasy.

Bitcoin is naturally to their liking. After all, it is both technical and humanistic, both realistic and ideal.

Chang Qia is such a person. After he came into contact with Bitcoin in 2009, he was quickly convinced by the grand ideals behind Bitcoin. Chang Qia recalled: "The emergence of Bitcoin perfectly fits my imagination of the cloud era and the grand distributed computing project. I was quickly fascinated by it..."

In 2011, Chang Qia found a job within the system. Like Liu Cixin, he slacked off during work hours and roamed around the Internet, specifically introducing Bitcoin to the public.

This year, a female college student asked a question on Zhihu: How should I invest 6,000 yuan?

Chang Jian gave an answer that was beyond everyone’s understanding: “Buy Bitcoin, keep the wallet safe, then forget about it and look at it again in five years.”

A few years later, Bitcoin skyrocketed. If the female college student had listened to Chang Qia's advice at the time, she would have definitely become a billionaire.

Therefore, this reply was dug out and worshipped by countless people, becoming a "Zhihu God Post" of a generation.

However, at that time, Chang Qia received not praise but ridicule. Bitcoin was at its bottom and no one believed that Bitcoin could make money.

Chang Jian was not convinced, so he started to post articles about Bitcoin on his blog and debate with the haters.

One day, he suddenly received a message from a person named QQAgent: "Blogger, I think your website is very valuable. Why don't you apply for an independent domain name and space? I'll pay for it."

This QQAgent is Wu Jihan.

However, Chang Qia was unwilling to follow Wu Jihan to make mining machines because he had a deeper understanding of Bitcoin than others.

Chang Qia believes: "If you only understand Bitcoin from the perspective of investment arbitrage, you are just a passer-by in its life who is content with a small fortune; but if you understand it from the perspective of philosophy and technology and immerse yourself in it, you will be much richer than the former in terms of wealth and spirit."

Chang Qia was unwilling to get lost in the ups and downs of wealth, so in 2011, Chang Qia cooperated with Wu Jihan to establish Babbitt. Since then, the Chinese currency circle has had its own Bitcoin media.

If Kaomao is the guy who sells shovels during the gold rush, then Chang Jian is the guy who runs a tavern and sells intelligence.

However, perhaps because he was too idealistic, Chang Jian’s Bitcoin career was not smooth. Both Babbitt and the later Bytom Chain were popular at one time, but they were short-lived.

Compared with those first-generation entrepreneurs of the same generation as Chang Jian but who have already achieved financial freedom, Chang Jian is obviously not as "successful".

Why do we spend so much time and effort to introduce Chang Jian’s story? Not only because he was a Bitcoin evangelist in China, but also because his Babbitt almost connected the entire cryptocurrency circle in those years.

Let me put it this way, in the wild era of Bitcoin, almost all the first-generation entrepreneurial leaders knew each other at Babbitt.

One day in 2013, a person named "GGGGG" posted a message. The core content of the post was about offline homosexuality.

The location is in the holy land of grassroots entrepreneurs in Beijing: Garage Coffee.

There were a lot of losers in that offline meeting, but most of them became big shots in the future, such as Shenyu, Zhao Dong, Li Xiaolai, Nangua Zhang, etc., and they talked about the future of Bitcoin.

From then on, cryptocurrency players from all over the country began to frequently organize offline groups, connect resources, attract people to cooperate, and create one cryptocurrency myth after another.

For example, Wu Jihan met Zhan Ketuan, who came from the integrated circuit industry, and they jointly founded Bitmain.

Pumpkin Zhang met Li Jiaxuan and founded Beijing Canaan Creative Innovation Information Technology Co., Ltd., which later became a mining machine giant.

Li Xiaolai met Zhu Fangyi and started his own mine.

Li Lin met Du Jun and began to plan to build a platform.

Of course, there is also FriedCat, and a considerable number of mining machines are also sold on the forum.

These people often gathered in a small courtyard, talked all night, and then left with great pride.

The sky was as dark as ink, the lights were dim, and the road ahead was completely invisible, but everyone was still full of enthusiasm.

Under the connection of the initial cryptocurrency enthusiasts, mining machines and mining farms began to flourish on the market, including Silverfish, Little Bee, Rand, TMR, SmarT, 42BTC, etc., marking the arrival of the golden age of Bitcoin in China.

As more people mine, more problems arise.

During the exchanges, the biggest pain point for these first-generation entrepreneurs in the cryptocurrency circle is that they have mining machines and Bitcoin, but lack a trading platform that Chinese people can control.

At that time, the world's Bitcoin transactions were mainly monopolized by two platforms, namely Mt.Gox in Japan and BitStamp in Slovenia.

What about China? There is only one trading platform - Bitcoin China.

The founder of Bitcoin China is Yang Linke, who originally sold sauna equipment. By chance, he invested tens of thousands of dollars and set up a Bitcoin China trading website.

However, this trading system is very simple. To top up, you need to use online banking to transfer money to two accounts. Their holders are Yang Linke's wife and mother-in-law.

This is not science fiction at all.

What is more critical is that both domestic and foreign platforms have problems of low security and slow speed, and often charge a two-way transaction fee of 0.03%.

As more people in the circle complain, naturally someone will set their sights on this business.

Thus, in 2013, two new Bitcoin trading platforms were born: Xu Mingxing's OKCoin and Li Lin's Huobi.com.

In order to seize the market, OKCoin and Huobi have adopted a fee-free model. This model is very similar to China's booming Internet industry. They first use the free model to attract users, and then charge fees after they have occupied the market.

With this move, Chinese Bitcoin exchanges instantly crushed international exchanges and soon accounted for 80% of the world's Bitcoin transactions.

They were lucky enough to catch the big bull market of Bitcoin.

In 2012, the price of one Bitcoin was still $13. By the end of 2013, the price had exceeded $1,000!

What kind of business in the world can achieve such huge profits? Soon countless people flocked into the cryptocurrency circle, even Chinese aunties who knew nothing about cryptocurrency joined in. The exchange was as busy as a vegetable market, the server was down for a time, and it took several hours to sell a bitcoin.

Facts have proved that selling shovels is not profitable, selling intelligence is not profitable either, the most profitable thing is to engage in trading markets.

In this way, Xu Mingxing and Li Lin earned more money than others could earn in ten lifetimes in just one year. In 2020, both of them were listed on the "Hurun Global Young Self-Made Rich List" released by the Hurun Research Institute.

That was truly a bonus of the era. If you caught it, you would soar to heaven, and if you missed it, you would miss it.

But the good times did not last long. The popularity of Bitcoin attracted the attention of regulators, who began to assess the risks of Bitcoin.

On December 5, 2013, the central bank and five ministries jointly issued the "Notice on Preventing Bitcoin Risks", denying the monetary attributes of Bitcoin and believing that Bitcoin cannot and should not be circulated and used as currency in the market.

The entire market was in a panic, the price of Bitcoin plummeted, and the money of countless speculators was wiped out in an instant.

Two months later, Japan's Bitcoin trading platform Mt.Gox posted an announcement, announcing that it had been hacked, more than 750,000 Bitcoins disappeared, and the company went bankrupt.

This has caused severe panic around the world. Who knows whether it is a real hacker attack or a "fake hacker who really ran away"?

Not long after, the American Butterfly Laboratory was also closed by the federal court for "suspected commercial fraud."

Since then, Bitcoin has entered a long bear market.

Zhao Dong’s position was liquidated in leveraged trading, resulting in a loss of 150 million.

Yang Linke sold most of his bitcoins.

The baked cat is missing.

Li Xiaolai also sold his bitcoins and wanted to open a billiard hall.

In the cold winter, those players in the domestic currency circle who are voicing their opinions and shouting "faith in Bitcoin" often forget that no matter how strong their faith is, it cannot defeat reality.

However, those who were able to hold on during this long bear market were handsomely rewarded in the future.

For example, Wu Jihan continued to improve his mining machines, maintaining 42.5% of the world's computing power during the Bitcoin winter, and later achieved the reputation of Bitmain as the "mining overlord".

For example, Li Lin’s Huobi.com. Li Lin believes that the policy does deny the currency attributes of Bitcoin, but does not restrict its commodity attributes. Bitcoin still has investment value. Huobi.com has obtained two angel round investments and continues to operate.

There is also Xu Mingxing's OKCoin, which has launched a trading leverage policy. Simply put, it treats Bitcoin as a financial product, realizing "cryptocurrency speculation" through short selling and long selling, and OKCoin charges a handling fee through RMB withdrawals.

Countless dreamers who wanted to get rich traveled all over the country, set up mines in the northern grasslands and the mountains of Guizhou, and started the "coin-making business" using cheap wind power and hydropower.

More than two years later, they finally received the reward from fate.

Bitcoin's underlying technology - blockchain technology, began to attract a lot of attention after 2016. Russian genius Vitalik Buterin added smart contracts, which greatly expanded the application scenarios of blockchain. Blockchain became the new darling of the industry, and the currency circle became popular again.

Those who persevered have made a complete turnaround in this bull market.

However, what is embarrassing is that new technologies are always used by scammers at the first opportunity.

What has blockchain brought? It has not brought the spring of “crypto-anarchists”, but the rampant “altcoins”.

The reason is simple. There are a large number of people in the market who do not understand "crypto-anarchism" or blockchain, but they understand human nature.

As long as there is greed in human nature, they can exploit human nature to make money.

Let’s think back to those years. Were there no advertisements for “blockchain financial management projects” everywhere? Did celebrities recommend blockchain on live broadcasts? Did friends and relatives even keep trying to get you in, saying that blockchain was a new hot topic and you should get on board as soon as possible?

In fact, they just want to reap the benefits.

Those market makers who issue all kinds of "copycat coins" often register a shell company first, and then find an outsourcing team to design a virtual currency, giving it a name like Dogecoin, Catcoin, Pigcoin, Eelcoin, or Shitcoin. Then they hire a network of internet trolls and invite bigwigs to speak on the platform and conduct live broadcasts to hype up the project, and then attract investors to participate in ICO, recharge transactions, and even crowdfunding to buy virtual mining machines.

With the dealer constantly raising the value of the currency, which can increase by 10% a day, who can resist the temptation? Even if some people know there are huge risks, they always bet that they are not the last one to pass the parcel, and as long as someone buys in, they can always make money.

As a result, they often become the leeks harvested by the bankers.

When the dealer has almost reaped the profits, he will simply announce the collapse of the virtual currency, leaving a mess behind.

Then the dealer changes the name and does it again.

What’s worse, altcoins have become a money laundering channel for telecommunications fraud. As long as the victims transfer the money, it will be converted into altcoins in minutes and then disappear somewhere in the corner of the earth.

In this way, the entire Chinese market has been tossed into chaos. More importantly, this method is completely beyond supervision and cannot be supervised at all. It is very easy to be manipulated. You think you can achieve financial freedom, but in fact, you achieve the financial freedom of others, and you are just a green leek.

In that era when altcoins were growing wildly, some people became rich overnight, while more people lost their families and lives. To put it bluntly, every profit in the cryptocurrency circle and every penny earned was stained with blood.

It seems that we can no longer sit idly by and must take action on Bitcoin.

Why?

Because unlike the United States and Britain, which are countries based on financial capital, China is a country based on manufacturing. Markets like virtual currencies, apart from stimulating speculation, have almost no role in promoting the real economy, national taxation, or consumption.

On the contrary, this kind of filthy "copycat currency" is essentially a kind of capital plunder in which the bankers reap the profits. It is not only not conducive to common prosperity, but it can easily amplify people's greed. Once it collapses, it can easily cause many social problems, and in the end the whole nation will have to pay the bill.

At the same time, China itself is a country with huge energy consumption and is under great pressure to reduce carbon emissions. Mines are the main source of carbon emissions. Some "mines" consume millions of kilowatt-hours of electricity a day. A "mine" in the southwest consumes as much electricity as three cities in a year...

Such a huge electricity consumption neither supports any real industry nor produces any actual value, nor does it drive employment and tax revenue. It only creates one wealth myth after another, which in turn attracts more people to rush into the flames.

Therefore, on September 4, 2017, seven ministries and commissions jointly issued an announcement, announcing a comprehensive ban on ICOs, believing that they pose risks of illegal fundraising and financial fraud. At the same time, all projects that have completed ICOs are required to return investors' funds and clear all ICO-related activities within a specified time.

This is the 94 incident that shook the cryptocurrency world.

As soon as the announcement came out, many altcoins went straight back to zero, and some altcoin exchanges even chose to close directly.

Even worse is yet to come. On September 14, 2017, the Chinese government officially issued a notice to ban cryptocurrency exchanges, requiring all cryptocurrency exchanges in China to completely withdraw from the Chinese market before September 30.

As a result, not only did currencies such as tc, eth, etc, and bch crash, but Bitcoin also collapsed by at least 20%.

So, what about the Chinese cryptocurrency community?

escape.

Yang Linke sold "Bitcoin China" to a Hong Kong blockchain investment fund.

Li Lin sold all of Huobi Global’s shares to Baiyu Capital.

As for Xu Mingxing, he is the most successful one in transformation. OKCoin has gradually transformed into a company that applies and develops blockchain technology. Xu Mingxing also serves as the director of the Blockchain Committee of the Beijing Youth Internet Association.

However, Xu Mingxing never expected that the future world of Bitcoin exchanges would be taken over by his former subordinates.

This subordinate is Zhao Changpeng, the richest Chinese who was just released from a US prison at the end of September this year.

Zhao Changpeng is from Jiangsu and was born in 1977. In 1989, his mother took him to queue for 36 hours in front of the Canadian Embassy and finally got a visa to immigrate to Canada.

Zhao Changpeng’s most intuitive impression of Canada was: It was the first time I drank fresh milk!

After graduating from university, Zhao Changpeng first worked at Bloomberg and later participated in the construction of the cryptocurrency market website Blockchain.info.

By chance, Zhao Changpeng met He Yi.

He Yi, who later became the top female star in the cryptocurrency circle, was originally a host of Travel Satellite TV. In 2014, she joined Xu Mingxing's OKCoin as vice president and was fully responsible for the brand building of OKCoin.

He Yi originally wanted Zhao Changpeng to advertise OKCoin on Blockchain.info, but Zhao Changpeng ruthlessly rejected He Yi.

Man, you successfully caught He Yi's attention.

He Yi felt that Zhao Changpeng did not let personal relationships influence his decision-making and was "very professional", so he introduced him to Xu Mingxing and invited him to join OKCoin.

This year, Zhao Changpeng was 37 years old.

Zhao Changpeng, who just joined OKCoin, did a very good job. He put forward many ideas on the infrastructure, custody and security of on-chain transactions. And because of Zhao Changpeng's overseas living experience, he has a natural advantage in developing overseas markets, so he quickly grew into the vice president of OKCoin.

At this point, Xu Mingxing, He Yi, and Zhao Changpeng became the influential figures in the cryptocurrency circle in 2014, known as the Iron Triangle.

However, the iron triangle was not solid, and Xu Mingxing and Zhao Changpeng soon fell out.

Some people say that the breakup was caused by huge differences between Xu Mingxing and Zhao Changpeng in technology and business approach.

Some people also said that the breakup occurred because Xu Mingxing discovered that Zhao Changpeng and He Yi were having an affair and were trying to steal his girl together.

Xu Mingxing once posted a Weibo post like this:

"How could they and I start a business together? The company also had clear rules at the time that if someone fell in love, one of them had to leave. As a senior executive, she took the lead in breaking the company rules. Now, bringing up these things doesn't reflect her professional ethics or partnership spirit, right? Anyway, without me, she wouldn't have her current marriage, so she should thank me for that."

The couple obviously refers to Zhao Changpeng and He Yi, and Zhao Changpeng was already married at the time.

When things got to this point, it was obviously impossible for everyone to work together anymore, and Zhao Changpeng and He Yi resigned one after another.

Then, in 2017, Zhao Changpeng and He Yi got together again and founded Binance.

At that time, Zhao Changpeng could not have imagined that his Binance would become the world's largest trading platform in the future.

Perhaps, he should be grateful for the 94 Incident.

The 94 incident was a disaster for Bitcoin China, Huobi and OKCoin, but for Binance, it was an opportunity to overtake others.

Why? Because Binance is registered overseas, its servers are also overseas, and Zhao Changpeng himself is a foreigner, so he is naturally well-positioned to take an international route. So when other cryptocurrency exchange bosses were busy drinking tea, Binance moved its servers to Hong Kong, which turned out to be a blessing in disguise and became famous.

At that time, 80% of the world's bitcoins were controlled by the Chinese, and the 94 world scared all the bitcoin holders in the country and they were eager to transfer their coins out. He Yi, who had experience in OKCoin, was well aware of the situation that the domestic market was flooded with LSPs. He set up a "Binance 101 Girl Group", all of whom were fair-skinned, beautiful and long-legged. Through some marketing activities such as "recharge to get girls private small gifts", they successfully attracted a large number of male customers. It seemed simple and crude, but it actually brought a large number of transactions to Binance.

In this way, after the 94 incident, the traffic of the three major exchanges, Bitcoin China, Huobi, and OKCoin, all went to Binance. Using the bitcoins controlled by the whole country, they turned this trading platform, which had just been established for a few months, into a global virtual currency trading giant.

What is the meaning of times making heroes? This is the times making heroes!

By 2021, Binance has become the world's largest virtual currency trading platform. Bitcoin, which was originally "decentralized", has become "centralized" because of the existence of Binance.

Binance's daily trading volume can reach $76 billion, and Binance can also obtain a large amount of commission from it. Just like a casino, whether you win or lose, the casino can make money.

Moreover, Binance not only provides trading services, but also issues Binance Coin BNB itself, plus handling fees, currency listing fees, service fees, etc., making a lot of money.

In January 2022, on the Bloomberg Billionaire List, Zhao Changpeng became the "richest Chinese" with a net asset of US$94.1 billion (at the time of approximately RMB 634.8 billion, second only to Musk's US$102.1 billion) and surpassed Zhang Yiming, Zhong Shanshan, Zeng Yuqun and other bigwigs to become the "richest Chinese" with net assets.

This is the first Chinese in history who has a net worth of nearly 100 billion US dollars, and is also the one with the grayest business.

However, having money does not mean safety. On the contrary, having money may mean insecurity.

After all, since the birth of crypto anarchism, there has always been a sword of Damocles on my head - regulation. From the perspective of maintaining financial security and protecting investors, regulatory departments in various countries have always seen Zhao Changpeng very unhappy. American economists have listed the "seven deadly sins" of virtual currency, namely concealment, corruption, deception, crime, fraud, price raising, and CZ.

This CZ is Changpeng Zhao.

After leaving China, Zhao Changpeng's Binance wandered around the world and was warned by financial regulators from many countries such as the United Kingdom, Germany, Japan, Malaysia, South Africa, Singapore and other countries. Zhao Changpeng didn't even dare to return home and hid in the United Arab Emirates for a long time, but in the end he could not escape the long-arm jurisdiction of the United States.

In June 2023, the U.S. Securities and Exchange Commission (SEC) announced that it had filed 13 charges against Changpeng Zhao and Binance.

At this time, no one yelled at the "business environment". After some rigging, Zhao Changpeng finally pleaded guilty to suspected charges of money laundering, unlicensed remittance, and violation of sanctions, and was forced to pay a fine of US$4.316 billion to settle.

However, even though Zhao Changpeng is so obedient, the United States still refuses to let him go.

After he went to the United States to sign his confession letter, his passport was immediately confiscated, and he was fined another $3 billion.

You see, this is the power of the national-level "pig killing plate".

In the end, with the efforts of the lawyer, and the collective letters from 161 relatives and friends, including his ex-wife, current wife, life partner, partner, sister and mother, the judge sentenced Zhao Changpeng to four months in prison.

On September 29, 2024, Zhao Changpeng was released from prison.

But, things are not finished yet.

In October 2024, U.S. prosecutors stressed that Binance failed to report more than 100,000 suspicious transactions with Hamas, Al Qaeda, IS extremist organizations, etc. The Binance platform also supports the sale of child sexual abuse materials and is also the recipient of a large amount of ransomware stolen money.

In November 2024, Zhao Changpeng was prosecuted again, demanding to recover nearly US$1.8 billion transferred from "based on fraud".

Zhao Changpeng's legend continues, and Zhao Changpeng's lawsuit continues. Obviously, as long as Zhao Changpeng's wallet is still there, the blood draw in the United States will not end.

The "anarchist cryptocurrency" that seems to challenge the government will collapse in one blow when facing the government.

III

Looking back on the history of the 10-year currency circle, how do you evaluate Bitcoin?

To put it technically, Bitcoin does not matter whether it is good or bad, good or evil, beauty or ugliness. It is just a program, an algorithm, and a series of mysterious codes hidden on the Internet.

To put it in a humanistic sense, Bitcoin is a combination of individualism, liberalism and technological determinism. It is the hope of technological geniuses and madmen on achieving anarchy and utopian society.

However, no matter how great the ideal is, it must be subject to the gravity of reality.

For liberals, Bitcoin is a great ideal for human progress.

For those who are not interested in technology and just want to make money, Bitcoin is just a tool to make money.

Because of the lack of supervision, Bitcoin is always full of ups and downs, and there is always no shortage of wealth-making myths. Due to the bias of survivors, everyone will only pay attention to those who make money.

When someone shows off in his circle of friends: "I made another 100 million yuan by accident."

When someone takes a photo of the steering wheel with half of the Maserati logo exposed and then matches it with "The God will pay off".

When more people show off a group of young models on the yacht.

Who can restrain his desires?

If you are a human, you have desires, and Bitcoin can arouse the most greedy glutton in people's hearts. You can't stand it, and I can't stand it either.

Luo Jinhai, the founder of Bixu.com, once had a very vivid metaphor:

Bitcoin is the supreme ring that governs the rings. It bewitches the mind. Those who wear the rings will eventually become slaves to the demon king Sauron.

In reality, those who bring Bitcoin rings will become slaves to this ring unless they have a very strong heart.

As a technology created by "crypto-anarchists", Bitcoin is neutral in itself, but when technology and reality are combined, problems will inevitably arise when encountering difficult-to-break human nature.

Satoshi Nakamoto can collide with the unique hash value of 4.4 million trillion, but he cannot calculate the madness of human nature.

When greed in human nature distorts an originally neutral thing, this kind of thing itself is no longer important. There were tulips back then, but now there are Bitcoins. There is nothing wrong with tulips and Bitcoins, but only human nature is wrong.

Therefore, when human nature cannot withstand the negative feedback from technology, regulatory intervention is very necessary.

After all, Bitcoin cannot satisfy hunger or circulation, and there is no currency anchor behind it. In addition to consuming a lot of energy to create wealth-creating myths, it only brings disaster.

Why are Chinese so keen on the currency circle?

Why are 70% of the world's Bitcoin mined by Chinese people?

Why do Chinese control 50% of the world's Bitcoin market and most of the trading platforms?

Look at the stories of the generation of token circle masters who flew over the top of the mountain in the article in a flash but fell from the altar in a flash. There may be an answer in our hearts.

Don’t test human nature with Bitcoin, human nature will never stand the test.