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China may soon replace Bitcoin (BTC) and other virtual currencies with a national digital asset developed by the People's Bank of China. This is clearly something that goes against the ideas that Satoshi Nakamoto had when he created Bitcoin. Indeed, most cryptographic space today is not conducive to centralized virtual currencies supported by the government.
According to Bloomberg, the People & # 39; s Bank of China, which works as the country's central bank, seems to be looking for ways to introduce a national cryptocurrency. With this digital resource, the government could have more control over its financial system. China is a centralized country that controls its citizens and at all times tries not to lose the power it has on its citizens.
With a virtual currency, it may be possible for the government to have more control over its financial system. It would also enhance the PBOC's ability to tackle money laundering and tax fraud. Moreover, with the information provided by the transactions, the central bank would have the opportunity to understand how individuals spend their money and how they behave.
With this virtual currency, the government will also have the option of replacing cash. This is what PBOC Vice-Governor Fan Yifei wrote at the start of this year in an article, as mentioned by Bloomberg. In addition, the central bank has also registered numerous patents that allow analysts to believe that users would use a portfolio to process payments and transactions.
According to the report published by Bloomberg, the project was initiated by the former governor of the Chinese central bank, Zhou Xiaochuan. Back in March, he retired and a new governor took his place. Yi Gang, who apparently supports, or at least bitcoin "likes", is currently the governor of the PBOC.
It was clear that Zhou Xiaochuan did not like virtual currencies. Regarding them he mentioned:
"We do not like speculative cryptocurrency products because it's not a good thing to give people, the illusion of getting rich from one day to the next".
Since 2016, the bank has registered about 78 patents related to virtual currencies. Although the currency can be introduced in a relatively short period of time, market expansion will be gradual.
At the same time, according to a patent filed by the bank, banks will have to gather information on borrowers and interest rates before they can transfer these funds. This would also contribute to the blacklisting of individuals and companies from borrowing. Bloomberg also says that there are some critics who believe that technology could be used to punish regime dissidents.
Currently, Venezuela is the only country in the world that has decided to create a local virtual currency. The so-called Petro is currently the only digital asset supported by the government in the world. Other countries such as Canada, Ukraine, the United Kingdom, Norway and Sweden have also analyzed positive and negative aspects of the issuance of a digital currency.
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