The digital yuan, or how China plans to win cryptocurrencies and seize absolute power
The Chinese government has not missed a beat against bitcoin and private financial services. Simply banning the use of crypto money was not enough. The digital currency of China’s central bank referred to as the digital yuan is already being successfully put into circulation and is the strongest growing project of its kind in the world. Surveillance totalitarianism is advancing and could have an effect not only in the People’s Republic of China.
The digital yuan is the Chinese government’s response to the increasingly popular blockchain technology, which is responsible for the growth of the cryptocurrency market. The central bank of the People’s Republic of China has concluded that the introduction of a digital state currency is safer because bitcoin and the like are, according to government rhetoric, highly unstable, speculative and lacking in intrinsic value, and that they can be used for money laundering. An interesting, or rather not so interesting, feature of this currency is supposed to be its expiration date, Business Insider reports. It will not allow citizens to accumulate wealth, well, unless regulations are implemented to mandate appropriate behavior, although here too China does not fail, after all, it already has its social trust system, read. interference in the private lives of its citizens.
China knows what diversification of influence is!
Looking at the Middle Kingdom’s policy is just a chant to kill three birds with one stone. First, the digital yuan is the ability to track every transaction that was made with it, which is part of the trend of controlling its citizens. Second, the stigmatization of cryptocurrencies and clever demagoguery may cause quite a few people to lose confidence in them, trusting the “more secure” currency issued by the State. Third, the Chinese market is steadily growing and is moving to settle payments globally to the level of its currency. They are currently an economic powerhouse, but with the achievement of their goal they would become an undisputed superpower, outclassing the United States, for which it would mean an unimaginable recession.
e-CNY, or the largest digital state currency!
The Working Group on the Olympic Games. The central bank’s e-CNY Research and Development Directorate published a paper last year that excerpted that the digital yuan is intended to diversify the forms of cash available to the public, meet digital settlement needs, and promote financial inclusion. It is understood to support fair competition, efficiency and security of transaction systems, and is expected to lead in theory to secure and regulated international payments.
For several years the digital yuan has been the most important and piloted project of the authorities of the People’s Republic of China, the use of which is being gradually introduced, first in large metropolitan areas such as Shenzen and Shanghai. In the beginning, people had to submit to a lottery that drew a share to belong to the first users. Today, the digital wallet is available to Chinese on iOS and the App Store. According to a TechCrunch article, Zhou Lan, the head of PBOC’s financial markets made a transaction worth more than 87 billion yuan in a digital wallet. This treatment has helped the app already have more than 260 million individual users, which means that 20 percent of. national population.
However, this is not a product for everyone (at least for now), as it is only available to residents of pilot cities and tourists on the occasion of the Winter Olympics. This is an interesting move considering that in order to exchange cash for e-CNY, users will have to transfer money from one of the digital commercial banks authorized by the PBOC to handle and trade digital currency examples include Tencent’s WeBank and Ant-backed MyBank. So there would be a lot of benefits if the China plan worked out. The question is whether it would work. Cold calculation of Chinese analysts is probably focused on movements more image-oriented, and by the way testing in terms of operation. The Chinese may want to study the impact of the yuan on both markets and society and refine it, so as not to lose the design work by publishing it in an ill-considered way and losing credibility in the market. This is confirmed by the limited distribution and numerous press conferences or financial reports, such as the one cited here..