In an odd move, China recently announced that the country would begin ranking cryptocurrencies. However, this seems like idiosyncratic behavior, as China implemented a nation-wide ban on cryptocurrency trading and ICOs during last year. Nonetheless, China has now published ratings for 28 different cryptocurrencies, and the results have some part of the cryptocurrency community bewildered.
The cryptocurrency rankings come as part of a ”monthly ratings index” announced last week, which will be run by the China Center for Information Industry Development (CCID), a research division reporting to China’s industrial ministry. The CCID released the first monthly ratings index today, which quickly made waves with some unexpected rankings. The most publicized news is that while Ethereum found itself coming in at number one on the list, Bitcoin was rated as the 13th ”best” cryptocurrency out of the 28 participants. This places Bitcoin roughly midway in the list, despite being the world’s most popular cryptocurrency. The top five currencies were deemed to be Ethereum, Steem, Risk, NEO, and Komodo.
The ratings index is said to be based on three distinct criteria – application, innovation, and technology – however, the CCID did not publish how they came to their conclusions. The CCID originally claimed that it was launching the initiative to combat the absence of ”independent analysis of crypto and blockchain”. Moreover, the ratings are intended to serve as a sort of guide for other governments, researchers and organizations across the globe. This is not the first time ratings of cryptocurrencies have been made openly accessible – the US initiative Weiss Cryptocurrency Ratings is one previous example, albeit more centered on trade – however it is the first time a government has done this.
Most cryptocurrency supporters are welcoming the Chinese government’s entry into cryptocurrency, as it will bring more focus on how cryptocurrency should be regulated, and hopefully lead to increased cooperation between governments on how virtual currencies should be handled. However, it is surprising that China is the first country to spearhead this sort of project since the nation banned cryptocurrency trading last year. Moreover, the lack of transparency regarding how the CCID come up with its rankings is also a potential cause for suspicions.
Some like Eric Zhao, an engineer at the Chinese Academy of Sciences, are viewing the monthly cryptocurrency rating index as an indicator that the Chinese government is starting to regard cryptocurrency and blockchain projects as technology projects, rather than means to directly challenge the authority and power of established banks and governments. It remains to be seen whether China will take further steps to become more cryptocurrency friendly in the future.
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Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the cryptocurrency industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.