China’s Central Bank Will Launch a PBOC Fiat Crypto
We’ve known for quite some time that China’s central bank has a more sophisticated understanding of how to leverage centralized blockchain than many other countries. Indeed its blanket ban on cryptocurrencies has been somewhat strategic even as companies such as Bitmain have become some of the biggest crypto companies in the world.
The Digital Currency Research Institute of the People’s Bank of China (PBOC) is seeking talent focused on areas ranging from finance to cryptography that’s pointing to their acceleration of plans to harness the crypto wave in a way that’s in favor and in full control of their central bank. In China, Tech companies and blockchain itself are more shaped by the will of the Government than in maybe any other country.
As per vacancies observed in the People’s Bank of China’s annual hiring list for 2019, China needs to get serious about how to attract blockchain engineering talent. This as much of China’s upper middle class are looking to migrate out of China and its precarious economic uncertainty.
The Think Tank in China, which is behind the Central bank’s plan to integrate the Chinese Yuan with blockchain has been in the works for years. In 2014 the PBOC began such initiatives by forming a research group and last year officially launched the Digital Currency Research Institute headed by Yao Qian, a senior official with the bank’s technology department. Now at the end of 2018 it appears they are ramping up their team to actually build it.
Governments and banks around the world have publicly stated their opposition to cryptocurrencies like Bitcoin. However, that being said, we know that as soon as 2020 we might see central banks take their fiat currencies on the blockchain, thereby rewriting how mainstream digital assets become. China is thought to be among the first countries which can technically implement this.
According to CryptoSlate, PBOC chief Zhou Xiaochaun stated in March 2018 that an ideal digital currency would ensure all monetary and financial stability policies are met while protecting consumers from the nuances of fraud. It’s somewhat self-evident that a sovereign virtual currency would be cheaper to handle and easier to trace, a BitYuan if you will.
The rise of Bitmain demonstrates just how crypto friendly Chinese citizens really are. China has successfully invested more into blockchain than America and I think in the 2020s we’ll witness just how profound an impact this will have on the future of finance, FinTech, cryptocurrencies and blockchain.
While Chinese stocks have plummeted in 2018, exasperated by the trade war, tariff threats and America propaganda, there are multiple signs China has made headway in the race to technological supremacy, startups and innovation compared to America, with companies that scale faster and where mobile consumers have more options and more connected-user experiences.
China Could Beat America in Blockchain
It’s somewhat inevitable that China will beat America to fiat digital money. The fact that their Central Bank is working on it so diligently and hiring talent shows a trajectory that’s very different from the U.S. where Silicon Valley has been slow to onboard public blockchain projects and the SEC has also been slow to regulate the space.
China banned ICOs in September, 2017 and only later did American advertising platforms ban their Ads. Yet we know China has many blockchain startups and promising projects located in places such as Singapore that have connections to the Chinese Government.
A fiat digital Yuan is an intriguing way China could lead the world in the 2020s and it merits watching from the cryptocurrency community as central banks all over the world study how to implement centralized blockchains to augment and safeguard the future of transactions, money and digital assets. The South China Morning Post (SCMP) actively covers this story.