Bitcoin, an entity that was once dominated by China, seems to be slipping away from China and tipping towards the United States and President Trump.

With Trump on a mission to make the United States the "Crypto Capital of the world" and China cracking down even harder than ever on the crypto industry, it seems that the approach that both countries are adopting towards crypto cannot be more different.

As both countries detract further and further from one another, China seems to be slowly losing its grip and dominance on Bitcoin, but the tip of the scale seems to be turning in favor of the U.S.

What would this mean for both countries, and is it too late for China to change its stance?

China's shortlived dominance of Bitcoin

During the pre-Bitcoin era, China was the country that has dominated the Bitcoin landscape, particularly in the field of Bitcoin mining. China was able to leverage on its abundant, low-cost electricity and manufacturing capabilities to become the world's top mining corporation.

By 2017, over 70% of Bitcoin's mining capacity was located in China, making it a pivotal player in the network's governance.

But this dominance was short lived following a slew of regulatory clamdowns. In 2017, China banned Initial Coin Offering (ICOs) and shut down local cryptocurrency exchanges.

In 2021, Beijing banned Bitcoin Mining altogether and declared cryptocurrency transactions illegal in the country, citing concerns over financial stability, frad, and energy consumption.

These actions drove miners and cryptobusinesses out of the country, with many relocating to other crypto-friendly nations and regions.

Despite the tough treatment of cryptocurrencies, the Chinese government does support the development of blockchain, adopting the technology for a multitude of applications.

U.S taking a totally different direction

On the other hand, the U.S seems to be going in the totally opposite direction. After winning the 2024 Presidential election and returning to the White House, the first thing President Donald Trump did was to engage in a conversation with top CEOs and investors to discuss ways to improve the crypto landscape in the country.

This shift began to take shape during his campaign, where he promised to make the United States the crypto capital of the world. The then self proclaimed Crypto president Trump explained that the US must embrace cryptocurrency to avoid letting China dominate the field.

Trump's support for Bitcoin comes at a time when cryptocurrencies and digital assets were experiencing rapid growth in status and market size. In 2024, the value of cryptocurrency has ballooned, gaining traction among buyers all around the world.

"By embracing cryptocurrencies and fostering US dollar-backed stablecoins, the US can embed its currency even deeper into the global financial system, countering efforts fro mChina, Russia and others to build alternatives to the dollar."

By fostering innovation, attracting cryptocurrency firms and integrating blockchain technology into financial system, it also gives the US the upperhand to get the global standards for regulation and trading of the assets.

Trump adds that while China is pushing forward very strongly as usual, but the U.S is currently in the lead and he would like to keep things that way.

Just days before his inauguration, Trump released his own cryptocurrency, the Trumpcoin or $TRUMP. Subsequently, Lady Melania Trump also announced her $Melania coin not long after.

Is it all too late for China?

With the United States taking off in the world of crypto, is it too late for China to make a u-turn when it comes to their policy regarding Bitcoin more broadly speaking, cryptocurrencies?

Another big question would be: "How much would China be really losing out by tapping out of this Bitcoin battle."

And a recent study would show that China is not really losing out much actually. According to a research study, only 4% of the world's population has ownership in Bitcoin, with most of the ownership concentration in North America.

This shows that despite all the hype around Bitcoin and cryptocurrency, it is actually still at its very nascent stage and the idea of cryptocurrency being the currency of tomorrow is still very from becoming a reality.