Even the most oppressive governments can't monitor or trace payments made with physical cash. But tracing Bitcoins is easy, thanks to the blockchain.<p>I wouldn't be surprised if there is a sudden crackdown, in which BTC China's records are seized and used to identify individuals who are using Bitcoin to shift money overseas. In fact, who's to say it's not happening already?
Interesting article overall, but:<p>"it is inconceivable that Baidu would permit the acceptance of Bitcoins without first clearing the matter with Beijing authorities"<p>It do not seem to be what suggested Kaiser Kuo <a href="http://qr.ae/GsjwK" rel="nofollow">http://qr.ae/GsjwK</a> and it should be noted that Baidu is a bunch of small sized teams competing each other fiercly. Accepting Bitcoin could very well be decided locally, and the risk would be localized.<p>Even if the higher instances in Baidu or higher have heard of it, they probably won't have endorsed it officially and will be able to say they didn't know.<p>I would be extremely surprised if the Chinese government would be very open-minded with bitcoins and would suspect an hidden agenda behind. Why? Because from all what we know of Bitcoin and its use, it allows bypassing a lot of controls, and even threaten directly the life and blood of any government on Earth: the taxes.
My take on China's embrace of Bitcoin is not that it will help it with police-statesmanship, but simply that they really don't like the USG dollar, and would love if the international monetary system made a little more sense. Right now, Japan, Germany, and China (mostly) buy enormous amounts of US treasuries at tiny/negative interest, only to see them defaulted on little by little at the pace of inflation (which is of course paced by the USG). China doesn't really believe in fiat currency, definitely not at the state level. They should know, they invented paper currency back in the day. Instead, they buy precious metals (and other metals, they stockpiled copper during the gold boom a few years back), and I think they see something very similar when they look at Bitcoin. They see gold 2.0, at any rate, a contender to become the world's reserve currency, only with better liquidity than gold, less inflation (you can mind more gold into existence, but Bitcoin is capped at 21 million), and harder to forge.