Geopolitical Global Reform and New Technology: China’s Dash for Digital Currency Domination

This year, the Bank for International Settlements issued a report and survey indicating that 80% of the world’s central banks are working on some form of digital currency.

China has taken the digital currency experimentation much further than any other nation. Recently, in the eastern Chinese city Suzhou, just west of Shanghai, a lottery was held in which 100,000 residents each received 200 renminbi (about $30) via a digital wallet.

They were encouraged to link their digital cash to their bank accounts, and if they didn’t spend their digital cash within a few weeks, it disappeared — both great techniques to advance the experiment.

As China moves toward nationwide adaptation of the digital yuan, it is likely to undercut demand for bitcoin and other independent cryptocurrencies. Next year may see similar experiments in other countries.

President-elect Joe Biden’s administration will have higher priorities in its first 90 days than regulating cryptocurrency, and of course Congress’ mood and expertise on the subject is hard to read. The natural assumption is that a Democratic administration will regulate more stringently than a Republican administration, yet some have asserted that Biden will be “good for cryptocurrency.”

This could be the case, but bitcoin enthusiasts tend to overlook issues like anonymity and its potential use for fraud; for regulators, those are very serious concerns.

Biden’s team might well come up with a more comprehensive and rational way of regulating cryptocurrency, but there isn’t much writing on the wall to prove the US Democrats’ inclination towards bitcoin adoption in the next presidential term.

In this article, we focus on how China will intensify its pursuit of digital currency and blockchain-backed electronic payment, and emerge as the long-term victor in the digital currency sweepstakes against the United States.

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