China, the PBoC x Blockchain: Love and Marriage, Horse and Carriage

By Blockchain.News Official   Oct 30, 2019 2 Min Read

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This article is contributed by our content partner, Nexchange NOW.

It’s all about China and blockchain. After breaking news of President Xi Jinping’s official endorsement on the blockchain technology and Bitcoin performing a sharp “to-the-moon” move and hitting $10K over the weekend, blockchain-related stocks in China also received a major boost.

Derivatives exchange FTX has launched an index of eight popular China-based cryptocurrencies. Chinese state media, however, issued a warning for investors to keep calm and rational.

The temporary boost in Bitcoin, crypto and stocks is connected to a longer-term game plan by China to use digital currency to push back on the dominance of the US dollar on global finance.

Recent days have seen over 60 Chinese tech stocks surge by 10%, the daily limit on the Shanghai and Shenzhen stock exchanges. According to Bloomberg, some of these companies are officially registered blockchain businesses, while others just recently asserted their blockchain credentials in order to capture the wave started by Xi’s comments.

The sector may be bigger than many anticipated; China Electronic Information Industry Development, a government think tank, announced on Oct. 27 that there are over 700 blockchain enterprises in China, with over 500 relevant investments reported.

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Photo: Bloomberg

The PBOC is a believer
The People’s Bank of China (PBoC) is taking up the mantle of a blockchain evangelist. Following Facebook’s announcement about the founding of Libra, it announced its own plan to launch a Digital Currency Electronic Payment (DCEP) in early 2020 in coordination with global payment players from China including Tencent (WeChat Pay) and Alibaba (Alipay) to internationalise the Chinese currency, the RMB.

On Monday October 28th, Li Wei, the head of the technology department at the PBoC, has called for commercial banks to adopt blockchain technology in digital finance, while speaking at a forum in Shanghai. One of the drivers is to better enable forex transactions.

Not only could the future PBOC token “snatch a third of online payments market”, but it could also accelerate the creation of a reserve currency competing to the US dollar and re-balance the US/China trade war. Alicia Garcia Herrero, Chief Economist Asia Pacific fo Natixis, a French investment bank, outlined how this could happen in an exclusive interview with NexChange’s Olga Yaroshevsky.

Other thought leaders in China seemed ready to bolster Mr Li’s message and support Chinese monetary ascendency.

Huang Qifan, Vice President of China Center for International Economic Exchanges (another Chinese government think tank) said during a speech in Shanghai that China’s central bank would be the first to launch a digital currency successfully. He also called SWIFT “an outdated, inefficient and costly payment system.”

The investment community outside China is taking note – and asking American leadership to do the same.

Anthony Pompliano, founder & partner at Morgan Creek Digital Assets and blockchain influencer, poked the President via Twitter:

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Image via Nexchange NOW
Original Article: http://www.nexchangenow.com/news/blockchain/71397/china-the-pboc-x-blockchain-love-and-marriage-horse-and-carriage/

 

 


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