Bitcoin is here to stay, Bobby Lee, the CEO of BTCC, one of China’s largest bitcoin exchanges, said on Tuesday.
Lee also told CNBC that “regulation is much needed” for the new “asset class”, at Hong Kong’s Rise conference, which runs till Thursday.
During a presentation, Lee declared that bitcoin is a new “asset class” that is based purely on information, and not reliant on identity and physical possession.
“It (bitcoin) doesn’t care about who the person is, it doesn’t care about citizenship, or whether you are a human or (a) cat,” Lee said.
In the past, he said, ownership shifted from possession of physical objects to a system based on identity ownership. But bitcoin was a shift from identity ownership.
“In the modern day, ownership of physical things is not possible, rather it’s (done) by identity. Ownership is conferred to you by your name, as owner of an asset class such as cars or bank accounts,” Lee said in his presentation.
“But identity ownership always has to be verified by a third party – someone has to verify it or judge you,” he said. He explained that the “trust” in bitcoin was based on mathematics instead of any “governments or third parties”.
Speaking on a panel on technology in China on Tuesday, Lee said the fact that most bitcoin “miners” were in China was just a “state of an affairs”.
“Anyone can be a miner … why is it popular in China? (It) is the cheaper equipment and the (cheap) cost of electricity. But that can change in five years.. that can change in an instance.”
Lee predicted that more regulatory oversight would happen with Initial Coin Offerings, popularly known as ICOs, where funds are raised for cryptocurrencies, often through unregulated means.
He said while China had not expressed an opinion on regulating ICOs, the authorities “have expressed a view about regulating bitcoins and cryptocurrencies”.
“It’s coming, it’s only a matter of time,” said Lee, giving an analogy of how stock markets became regulated in the past due to investors losing money. “I think the same thing (regulation) with happen with ICOs, just like it happened with banking, with loans.”