Chinese Central Bank gave many reason for developing their own cryptocurrency like lower operating costs, greater efficiency, and better control of illicit money flows. But what I believe is that they are bringing their own cryptocurrency because of the increasing popularity of bitcoin. It is like if you can't beat them, join them.
What they do not understand is that attitude will legitimize bitcoin even more in the eyes of the people and investors, since they will see bitcoin is way better than this crypto created by the Chinese simply because it was not created and controlled by any government, so in a way in their attempt to try to discourage bitcoin adoption are only going to help bitcoin even more. 
Topic: China Moves Closer to Issuing Blockchain-based Currency (Read 954 times)
Another important thing to note is that Bitcoin is sometimes called gold 2.0.
It is indeed preferable to gold from the standpoint of governments outside the US. No currency can (directly or indirectly) peg itself against gold and achieve stability without a big devaluation of that currency against gold, as compared to today's gold price in that currency. Devaluation would be embarrassing to the currency's issuer.
Gold is still much more expensive than Bitcoin, and any big purchase would make it even more expensive.
With Bitcoin, the embarrassment can be swept under the rug by saying we're not pegging against a non-state money for stability; we're just moving to a modern, electronic infrastructure for our monetary system.
It is indeed preferable to gold from the standpoint of governments outside the US. No currency can (directly or indirectly) peg itself against gold and achieve stability without a big devaluation of that currency against gold, as compared to today's gold price in that currency. Devaluation would be embarrassing to the currency's issuer.
Gold is still much more expensive than Bitcoin, and any big purchase would make it even more expensive.
With Bitcoin, the embarrassment can be swept under the rug by saying we're not pegging against a non-state money for stability; we're just moving to a modern, electronic infrastructure for our monetary system.
Chinese Central Bank gave many reason for developing their own cryptocurrency like lower operating costs, greater efficiency, and better control of illicit money flows. But what I believe is that they are bringing their own cryptocurrency because of the increasing popularity of bitcoin. It is like if you can't beat them, join them.
Operating cost, efficiency, etc. are for public consumption. The increasing popularity of Bitcoin as a store of value increases awareness about blockchains, and makes it possible to build a strong foundation for their yuan by pegging it to a blockchain. This becomes an alternative to being enslaved by the dollar system and is a good bargaining chip for Beijing against Washington.
China is smart, they let Bitcoin grow in their country, hire people working in the Blockchain industry and voila, they're one step ahead of most countries in the total manipulation of domestic money (untrusted private chains). Maybe the US is next or even Japan 
If crypto is similar to what horseless chariots(cars) were to horse driven buggys.
I wonder if china, russia and other nations which adopt crypto early on will have an advantage over countries like the united states which oppose change rather than embracing it.
Might be interesting to see people weigh in on that topic.
I wonder if china, russia and other nations which adopt crypto early on will have an advantage over countries like the united states which oppose change rather than embracing it.
Might be interesting to see people weigh in on that topic.
This is great news for Bitcoin. At first, you would think this would reduce Chinese demand for Bitcoin,
How is this great news for bitcoin? I don't think anything is great here at all. Low demand for bitcoins will only result in low growth/less trading volume and eventually low prices.
You call this great news? Not really.
On the other hand, what the Chinese Government creating is somthing like ethereum. A centralized block chain. Means it won't be anything like bitcoin at all other than using a blockchain.
It won't change anything for bitcoin unless people decide to be slaves of the government by their own will and from my experience i tell you that it has a high possibility.
The demand for Bitcoin will come from US-driven forces. If China strengthens its own currency by pegging it to a blockchain in some way, the act is bad for the dollar in multiple ways (as I mentioned above.) The only way for the US to fight back will be to promote Bitcoin, somehow. (So far it seems Japanese and S. Korean governments and 'housewives' have been doing the US's bidding...)
There is theoretically another option open to the US, and that is to peg the dollar to its own blockchain. My thinking as to why the US has given no sign of doing this so far is that this carries unknown risks that financial markets will suddenly change their expectations. And in any case, the dollar gives the US elites more flexibility and is enjoying global reserve currency status anyway, so there is no benefit to changing its basis at this point. Plus, the global financial elites have a profound reason for keeping non-state assets alive -- see The Real Reason to Hold Gold and Bitcoin.
This is great news for Bitcoin. At first, you would think this would reduce Chinese demand for Bitcoin,
How is this great news for bitcoin? I don't think anything is great here at all. Low demand for bitcoins will only result in low growth/less trading volume and eventually low prices.
You call this great news? Not really.
On the other hand, what the Chinese Government creating is somthing like ethereum. A centralized block chain. Means it won't be anything like bitcoin at all other than using a blockchain.
It won't change anything for bitcoin unless people decide to be slaves of the government by their own will and from my experience i tell you that it has a high possibility.
Governments attempting to create their own cryptocurrency just legitimates bitcoin. As governments create their closed source, centralized cryptocurrencies, bitcoin will gain more legitimacy as the gold of crypto, because when people want the equivalent of gold in a cryptographic way they will think of the capital B original blockchain.
I wonder what will happen to bitcoin price if china really succeed in issuing their own blockchain-based currency, since china is one of the country that have a huge volume of trading bitcoins daily, maybe this would cause a big drop in bitcoin values if china traders goes towards focusing more trades on their own country issued blockchain currency, but this is a very good move by china to increase fiat money flowing into their country reserve.
I wonder if there will be a finite supply of this digital Renminbi or will it just keep issuing new coins like they would issue paper money? I would be curious to know the starting supply of it. It could be really useful as a tool for import and export I think primarily as opposed to main use inland.
My guess is that the crypto itself will be finite-supply, but the central bank will issue 'money' which is essentially IOUs payable in the crypto. The central bank will have mined a lot of coins before announcing the system. This kind of system will eventually collapse, of course, but will initially be stable.
Strictly speaking, today's technology allows many variants of the classical gold-standard-style of money described above, but they'll essentially all work the same way, even if the propaganda about the nature of the system can be quite novel.
Simply, no. This is by no means any sort of good news for bitcoin at all. If anything, it is bad.
They aren't even creating a decentralized coin here. They are blatantly just creating a centralized shitcoin, if you will. They will control the supply and demand of the crypto-CNY, transactions will be reversible probably to combat fraud, and the whole thing is no different to the current bank setups if you think about it.
They aren't even creating a decentralized coin here. They are blatantly just creating a centralized shitcoin, if you will. They will control the supply and demand of the crypto-CNY, transactions will be reversible probably to combat fraud, and the whole thing is no different to the current bank setups if you think about it.
You are absolutely right here (and I basically agreed in one of my two posts I provided links to.)
There are of course many forms the 'crypto CNY' can take, but they'll all have the same basic features you describe. (Please also note that this would also be no different from the gold and silver standards the elites have used to control money and finance over the last few hundred years.)
I don't get why you think just making something crypto is going to generate interest for investors. Sure, it might be more convenient, but in this case it's not decentralized, therefore it is still controlled by the government.
Imagine some government suddenly backing their money with gold, as in the past. If they set their price of pegging carefully, their system will be very stable, initially, since they'll have enough gold to defend the peg against any capital flight. Of course gold would command a much higher price than today. This act would amount to cancelling most current debt and resetting the system. It would provide a new stability and prosperity for the country since it would allow that country to print and borrow money without suffering instability, at least initially. This was essentially what France did in the 1920s. A lot of money flowed to France. A crypto-currency will be no different.
This would be devastating to the imperial system since it would further undermine confidence in the core imperial asset, which is the dollar. This is why the US-led system won't tolerate any country moving in that direction. Since China is not afraid of the US military, and apparently there are serious disagreements between Washington and Beijing at this point, this move is a valuable bargaining chip in Beijing's pocket.
If and when governments begin using blockchains to back their currencies, every time they're in conflict, the non-state Bitcoin will become a weapon they use against each other. As I repeated many times, we don't have to worry about what form any money takes; we do have to worry about unity among the elites of different countries.
Chinese Central Bank gave many reason for developing their own cryptocurrency like lower operating costs, greater efficiency, and better control of illicit money flows. But what I believe is that they are bringing their own cryptocurrency because of the increasing popularity of bitcoin. It is like if you can't beat them, join them.
yeah right mate china always have the mentality of copying things that will benefits them so after they seen how bitcoin works and how many people around the world already adopting this system they wont allow that they will left behind so they decided to create their own crypto currency.
Anyone else here that thinks the USA is seriously lagging behind the bitcoin revolution? Because China and Russia are both planning on implementing their cryptocurency right now, and the USA just doesn't seem interested at all.
Even if the cryptocurrencies they issue are centralized in my opinion it'll still help drive adoption of the "real deal". People might not even use it when it comes out, but it will let them know about bitcoin, the father of cryptocurrencies.
Plus, blockchain technology could prove to be useful for mitigating risk of hacks by building an immutable database.
Even if the cryptocurrencies they issue are centralized in my opinion it'll still help drive adoption of the "real deal". People might not even use it when it comes out, but it will let them know about bitcoin, the father of cryptocurrencies.
Plus, blockchain technology could prove to be useful for mitigating risk of hacks by building an immutable database.
Simply, no. This is by no means any sort of good news for bitcoin at all. If anything, it is bad.
They aren't even creating a decentralized coin here. They will control the supply and demand of the crypto-CNY, transactions will be reversible probably to combat fraud, and the whole thing is no different to the current bank setups if you think about it.
I don't get why you think just making something crypto is going to generate interest for investors. Sure, it might be more convenient, but in this case it's not decentralized, therefore it is still controlled by the government.
At least they are attempting to pick up new technology, the US Government doesn't even care about cryptocurrencies at the moment let alone create one.
You are right, since the government can manipulate it, and this would be a downside. Maybe this digital currency will also let more people get to know about the blockchain technology that Bitcoin uses and perhaps get some for themselves. Is China aiming to create a worldwide currency? That would be quite scary to think of, but Bitcoin would still definitely be better as you have full control of it. They aren't even creating a decentralized coin here. They will control the supply and demand of the crypto-CNY, transactions will be reversible probably to combat fraud, and the whole thing is no different to the current bank setups if you think about it.
I don't get why you think just making something crypto is going to generate interest for investors. Sure, it might be more convenient, but in this case it's not decentralized, therefore it is still controlled by the government.
At least they are attempting to pick up new technology, the US Government doesn't even care about cryptocurrencies at the moment let alone create one.
More and more people are learning about Bitcoin and its technology and I believe it would be as common as cash one day in the digital world, slowly but surely.
Chinese Central Bank gave many reason for developing their own cryptocurrency like lower operating costs, greater efficiency, and better control of illicit money flows. But what I believe is that they are bringing their own cryptocurrency because of the increasing popularity of bitcoin. It is like if you can't beat them, join them.
That might be a reason. Also several news has been coming out of the cryptoworld that China is into plans of legalizing bitcoin completely throughout the country. Something is making a confusion, so if the plan is to demolish bitcoin, why should they need to legalize it.In this time the operational cost is really high, The institution will no need the accountant or something like that.
Chinese Central Bank gave many reason for developing their own cryptocurrency like lower operating costs, greater efficiency, and better control of illicit money flows. But what I believe is that they are bringing their own cryptocurrency because of the increasing popularity of bitcoin. It is like if you can't beat them, join them.
That might be a reason. Also several news has been coming out of the cryptoworld that China is into plans of legalizing bitcoin completely throughout the country. Something is making a confusion, so if the plan is to demolish bitcoin, why should they need to legalize it.
In the end it will come down to trust. Do you trust a centralized authority or do you trust a decentralized network with no central authority. Up until Bitcoin came on the scene, people had to trust a centralized authority, because they were forced to, but Bitcoin has given people an alternative choice. Governments will misuse this technology to monitor and control people's wealth, like they did with fiat currencies. The Private Blockchain they use, will be the proof they need to follow your spending habits and to measure your wealth for taxation and more sinister political reasons.
Do we trust government employees and secret agencies with that kind of power? So far we had to, but now we have a choice. ^hmmmmm^
Do we trust government employees and secret agencies with that kind of power? So far we had to, but now we have a choice. ^hmmmmm^
I wonder if there will be a finite supply of this digital Renminbi or will it just keep issuing new coins like they would issue paper money? I would be curious to know the starting supply of it. It could be really useful as a tool for import and export I think primarily as opposed to main use inland.
See:
PBOC Hires Blockchain Engineers for Creating Digital RMB
This is great news for Bitcoin. At first, you would think this would reduce Chinese demand for Bitcoin, but if you think about it, the only reason for China to issue a blockchain-based currency is to inspire confidence in the yuan (renminbi,) to pull away from the current system of, in effect, backing the yuan with dollars.
China badly needs to shore up confidence in the yuan because it has inflated probably the biggest credit bubble in the world by propping up its economy with bad investments through debt and money issuance. It has recently appealed to patriotism in an attempt to stop Chinese from converting yuans into dollars by circumventing its capital controls (including through Bitcoin.)
The problem for China is, what will the US think of the new scheme?
Not only will the US not like the loss of leverage over China through the dollar system, but a crypto-backed Chinese currency would also be a potential threat to the supremacy of the dollar as the global reserve currency, since, such a currency would enjoy more investor confidence than fiat currencies (at least initially.) The only way the US can fight back is by undermining confidence in the Chinese crypto itself by supporting Bitcoin.
As I mentioned here and here, monetary affairs are not really driven by economics or finance, for the most part. They're driven by politics. It doesn't matter what form money takes, fiat, pegged to foreign currencies, pegged to gold, etc., when elites of major countries can't agree with each other, state-issued money suffers and non-state monies do well.
For example, in the 1960s, when first West Germany and the Netherlands, and then France, began redeeming their dollar reserves for gold at the Bretton Woods fixed price of $35/ounce, the only way the US could save itself was to abandon the fixed price in 1971, and to quickly re-legalize ownership of gold by Americans. Gold has jumped more than 30 times since then.
PBOC Hires Blockchain Engineers for Creating Digital RMB
This is great news for Bitcoin. At first, you would think this would reduce Chinese demand for Bitcoin, but if you think about it, the only reason for China to issue a blockchain-based currency is to inspire confidence in the yuan (renminbi,) to pull away from the current system of, in effect, backing the yuan with dollars.
China badly needs to shore up confidence in the yuan because it has inflated probably the biggest credit bubble in the world by propping up its economy with bad investments through debt and money issuance. It has recently appealed to patriotism in an attempt to stop Chinese from converting yuans into dollars by circumventing its capital controls (including through Bitcoin.)
The problem for China is, what will the US think of the new scheme?
Not only will the US not like the loss of leverage over China through the dollar system, but a crypto-backed Chinese currency would also be a potential threat to the supremacy of the dollar as the global reserve currency, since, such a currency would enjoy more investor confidence than fiat currencies (at least initially.) The only way the US can fight back is by undermining confidence in the Chinese crypto itself by supporting Bitcoin.
As I mentioned here and here, monetary affairs are not really driven by economics or finance, for the most part. They're driven by politics. It doesn't matter what form money takes, fiat, pegged to foreign currencies, pegged to gold, etc., when elites of major countries can't agree with each other, state-issued money suffers and non-state monies do well.
For example, in the 1960s, when first West Germany and the Netherlands, and then France, began redeeming their dollar reserves for gold at the Bretton Woods fixed price of $35/ounce, the only way the US could save itself was to abandon the fixed price in 1971, and to quickly re-legalize ownership of gold by Americans. Gold has jumped more than 30 times since then.
Simply, no. This is by no means any sort of good news for bitcoin at all. If anything, it is bad.
They aren't even creating a decentralized coin here. They are blatantly just creating a centralized shitcoin, if you will. They will control the supply and demand of the crypto-CNY, transactions will be reversible probably to combat fraud, and the whole thing is no different to the current bank setups if you think about it.
I don't get why you think just making something crypto is going to generate interest for investors. Sure, it might be more convenient, but in this case it's not decentralized, therefore it is still controlled by the government.
At least they are attempting to pick up new technology, the US Government doesn't even care about cryptocurrencies at the moment let alone create one.
not only china i think , any other country can use blockchain technology
that will be better than the traditional financial system
that will be better than the traditional financial system
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