The USA are stuck in regulatory approval and other issues whilst China appears to be adopting digital payments at a very fast pace.
Alipay, owned and operated by Ant Financial, has more than 600 million average monthly users, a number which is staggering when you think Switzerland only has a population of just over 8.5 million.
Now, the People’s Bank of China (PBOC), the central bank that runs China’s monetary policy, is announcing that its own “cryptocurrency.”
It is set to replace the Chinese Yuan that is currently in circulation, the “real physical” money will be held in a digital wallet or a smart-phone type account.
At the same time Facebook Libra is stuck, bitcoin and ethereum are still in adoption phases. In China there will be strict central control, possibly a small rollout and certainly with extra monitoring.
Commercial banks and the PBOC will be the only issuers, no Las Vegas gambling freedoms associated with Libra or other untraceable digital currency backed transactions.
Three out of China’s largest banks are wholly state-owned and the influence of the Chinese Communist Party must not be underestimated. No-one talks of mining or server farms, or a get rich scheme. Most people really believe the PBOC will want to take end-to-end control of the process.
There is likely to be a record kept of use as well, to align all financial transactions and data to form a section in the information pack for the new social credit policy.
The PBOC guessing has started in earnest, from private keys to multi-signature authentication options to registered and declared value or assets to a central authority who holds the access secret keys to the funds they control.
The next few months will tell. No-one doubts that China’s adoption of digital payments will outpace the USA, as for Switzerland the revolution is happening and typically Swiss, they are saying not a lot to anyone!
Tags: 3 minute read bitcoin cryptocurrency digital payments and retail