Bitcoin Forum

China central bank to release digital currency prototype in 2017

Back in August 2016, Fan Yifei, Vice President fo People’s Bank of China, has written an article elaborating the theoretical basis and framework selection of China’s fiat digital currency. He says that the legal framework of China’s legal digital currency tends to follow “central bank – commercial bank” dual model, that is: the central bank is responsible for digital currency issuance and verification monitoring. Commercial banks are responsible for providing digital currency circulation services and building application for the ecosystem. A Demo system is expected to be released after the Spring Festival of 2017 after two rounds of revision.



http://news.8btc.com/china-central-bank-to-release-digital-currency-prototype-in-2017

Fiat digital currency... I thought nearly all fiat currency was digital already, as in it doesn't exist? Central banks should stop trying so hard to release their own shitcoins.

The future is coming very soon. This make some questions for all bitcoiners in the world, especially in China.
do we have to worry about that?
If this a good news, what is the best impacts for bitcoin users?

I knew it, if it does not happen now it will happen soon. Everything about economy, financial policies and technology in Asia points to that direction,  and if it can be adopted by a 1 billion country people, the value will be erupting. China has the recent track record of succeeding. This could help the trade of produce through online store to neighboring Asia countries, South America and Africa. If the government promote it. lots of money will be invested which make a big competition with bitcoin. By rumored Asia bitcoin centralization and mass adoption, bitcoin will be able to compete and survive it.

This is one of the signs that I always spoke about. This is one of the signs that bitcoin will possibly be a goner in the years to come. There are two things that may actually happen to bitcoin when this fiat digital currency is launch.

1. There will be huge volume of bitcoin being dumped in the market by Chinese holders and miners. And since they own the biggest shares when they dump bitcoin it will possibly drop to 500$ to 300$ each.

2. If China will not make a dump then bitcoin will remain the same.

So China's central banks discover the altcoin market. Great news. ;D

Not surprising, what the central bank has to offer is simply digital fiat money under their central control. They are basically replicating PayPal as a national service. Innovation: Zero, just as the government loves it. :D

It's good news, since teh fiat currencies released by governments will be closed source, heavily centralized, monitored and taxed, so people will search for bitcoin as the free borderless decentralized alternative that doesn't depend on any government. It's really good news actually since it accentuates the case for bitcoin, average joes will understand the difference.

That is lovely news. It helps bitcoin grow up higher. Like this news. Thank you for your share

These are all people expect. we will begin to enter the era of digital currency. bitcoin will have a very high prestige. china started this with a very nice, momentum.

Well its up to any of government. But such altcoins will become centralized not decentralized. And centralization can make it common. So even any of country launch own cryptocurrency it cannot beat bitcoin.

Even it will support bitcoin to become more valuable.

Why would anyone want to buy a centralized cryptocurrency which is controlled by a bank from China? :)
If I want anything like this, I would rather buy fiat. If I want some kind of independence and anonymity, I'll go for bitcoin.
I don't believe it will have a big success.

Why did the chinese panic sell in recent hours at the news of the government wanting to do something about bitcoin? (they didn't even mention the word ban as far as I know..) the government has a very powerful network effect. They can trigger panic sell on the weak holders, they will make them run for the comfort of a regulated and stable price currency. But of course, you'll never get rich holding a boring ass centralized, regulated closed source crypto so they will eventually come back to the excitement of bitcoin.

complete and utter crud same story regurgitated 50 times

the point is that the china central banks altcoin WILL BE THEIR FIAT

to citizens they wont see the difference at first. the banks will just swap their old database to a new database in very laymans terms. citizens wont notice the difference to how their bank balance is stored. as thats behind closed doors. but later they will start offering NFC smartwatches or  smartphone apps instead of debit cards/paper cash.

the benefit i can see is instead of card cloning and merchants storing card information. the hardware wallet(smartphone/watch/wristbands) just sends a signed tx to the merchant, making each transaction unique to that purchase. to avoid card cloning or merchant hacking. due to the fact a banking customer keeps the privkey safe in their own device.

the downside i can see is lose the device, lose access to your income and starve. in a utopian situation that was permissionless.. so to solve that, ofcourse the banks will have access to your key to 're-credit' you or give you a new device. making it still a permissioned/middleman payment system, meaning the system wont change much just the way a customer pays (NFC smartphone/watch instead of magnetic strip debit card or paper cash) will change

I can not see how this should help Bitcoin. At least, it could help to grow attention for crypto coins.

I opened a discussion (https://bitcointalk.org/index.php?topic=1717163.0) about "Central Bank Coins Are the New Altcoins" in Altcoin section three weeks ago. It cointains an interesting article about this topic.

funny part is that when people talk about media coverage of bankers using blockchains. first they try to say fiat is bad. but then go and shout happily about how it will make them profits when bitcoins FIAT PRICE rises so they can exit bitcoin and return to fiat.(facepalm)

banks hyperledger sidechain announcements do not effect bitcoin. (the technology) as they are separate things. so if all you care about is fiat prices, your not only missing the purpose of bitcoin. but also the hyper inflation of fiat due to the bankers sidechain swap. meaning your not going to gain anything when $10,000 only buys you a loaf of bread.

the fiat price and bankers fiat games are meaningless, when you start to appreciate what bitcoin is really about

Why would people want to make the same investment decisions to invest in a Chinese digital currency, like they did with Bitcoin. Every clever

investor will know the difference between private centralized ledgers and Bitcoin < public blockchain > A private ledger will never attract so

much investors, because of the higher risk involved with private blockchains. These blockchains have no public consensus, so they can

manipulate the supply, like they are doing with fiat currencies. So this will just be a digital version of fiat currencies.  

agreed with all you said, but to highlight one part.

but there is money to be made in manipulating the supply.
pump and dumpers make profits, while outsiders not involved can only react to the drama/crises such pump and dumps cause. but not benefit from it because they are on the outside.

bankers will profit from their hyperledger sidechains. its why they are doing it, they are the casino. and like gambling.. the house always wins

Indeed, they will profit from being the guys in charge secretly fucking around with the total supply. Can you imagine the disaster that it would be for bitcoin if devs could secretly raise the supply from 21 million to anything higher? That is how future fiat cryptos will work.

I have hope that people will realize the scam that that is, and they will then find bitcoin, and bitcoin isn't perfect but nothing in life is, and bitcoin is certainly a million times better than a closed souce govcoin nightmare.

But it doesn't answer my question.  ???
If the bitcoin holders are in panic, why would they buy another cryptocurrency instead of "safe" fiat?
What would be the difference?



That answers it more clearly and I have to admit that it makes sense.
I saw on it only from the economic point of view, but you're right, that it could be successful because of its better technology.

But then this would be just a digital fiat that they'd use to replace the yuan. I don't see any advantage in this compared to bitcoin. Well, they can do whatever they want, so long as they don't interfere with bitcoin's development and use. If they compel their citizens to exchange their bitcoins for this digital fiat, we could possibly end up with useless bits.

Why should I favor a centrally controlled government currency that can be manipulated and controlled, over a free-market and decentralized cryptocurrency like bitcoin or zcash?

The only reason I can think why a person would choose the first option is because someone is coercing them to do so. Governments have a lot of firepower and a history of using it. So this kind of development is ominous.

to me i have no idea about this and i am hearing this for the first time. to me i think chines are in majority to use bitcoin  as compare to other state of the world most of the miners are also from China. but still i do  not think that they can manipulate the price of bitcoin because bitcoin is a universal currency and not a regional one.

well it won't affect crypto currency too much, it is just a fiat that being change into digital currency, and the coin is not going to anonymous and it will be centralized, so there is no different with fiat, I don't think it will be successful, the government won't succeed to rule bitcoin down, the user used bitcoin because the user want a currency that free from control

So what, banks will do what ever they can to try and stay relevant, but their greed will always be their downfall, people want to control their own finances and they wont settle for a government controlled/inflated currency even if it works of a blockchain.  ::)

Though people would like to be with the decentralized currency its still not legalized in most countries and several countries were hardly opposing it. In such scenarios sure such centralized digital form of fiat to gets the attention of country men and if found successful then surely they prefer bitcoin for other transactions, because their own country currency gets circulated within the country.

Expecting it will be like USDT.... But the advantages can be taking from them, the Chinese people are no need for transacting his amount through the fiat.
Is this will give an advantage for bitcoin or will be restricting the competition in crypto. Interesting for watch.  8)

USDT seems interesting to trade bitcoin without having to deliver all of your personal data to the exchanges... has anyone tried it? In poloniex there is a 1000+ BTC market of USDT, seems enough to do some trading.


Seems like a good idea... you could trade anonymous in poloniex as long as you don't need to get out more than $2500.

If it is like bitcoin a Cryptocurrency I think it would need to wait many of years so it could succeed just like bitcoin did, but if it is just a fluke or using fiat as digital currency it is just like a online storage like paypal, by sending dollars as transaction well let's just hope it would not cause any trouble in the bitcoin community.

Today you can hide your operations away from the government by buying btc with cash, but as governments move towards digital currencies, they'll get much more control over all transactions, and it will be harder to obtain Bitcoins privately.

Do you think Antshare will soon have its advantage when their central banks digital curriency comes to realization? Antshares are known for its support by the chinese to which call this the Chinese ETH.

Well they can try and good luck to them. It shall fall flat on their face, cause it's again going to be centralized and government can track it, and not to forget the taxes they need to pay on the Fiat digital currency. Plus it's value won't increase like btc, it will remain same just trying to be cashless invokes lots of risk. Next year we all will read of how they tried but did not succeed lol

I agree with some of your views. The problem with Bitcoin is that it can be manipulated all the way from China since Chinese coin holders got a big percentage of the total Bitcoin volume. It can then be easy to see that China can be the downfall of Bitcoin...

I am not surprised by this news because I believe that the, blockchain has the potential to handle much more things than just crypto payments. People are working on a blockchain based property ownership recording system. In next few years we might see the blockchain technology in many sectors which not necessarily be related to payments. It has very good potential.

Centralization is bitcoin's achille's heel. One announcement of chinese government and bitcoin dropped 30%, and it's still dropping. What if in 6 months they decide it isn't enough and they ban bitcoin in china ? Most bitcoins are owned by the chinese since they mine it, if they dump the price can crash to 100$ easily. Or if the government decides to shut down the mining farms ? Any of these decision can kill bitcoin forever, since the difficulty cannot be adjusted in time, the remaining farms outside china cannot keep up with low hashpower because of the huge difficulty and bitcoin dies.
These are hard times for the public crypto / blockchain scene, because when bitcoin dies, most altcoins will die aswell.

China officially banning bitcoin and going against the miners could hurt bitcoin's price, but it's far from killing bitcoin "forever". We have already seen the price go from 1160 dollars to almost 2 figure dollars, and we saw it go from there to 4 figures again. Bitcoin has already demonstrated that it can be reborn from "death". Now it's the "if it did it once it can do it again" mentality is in the global market psychology.

No. Because back then bitcoin had low difficulty, and was more decentralized. But things changed, nowadays probably more than 90% of hash power is in china. So if 90% of the hashpower vanishes over night the network won't be able to recover because the low hashrate outside the china won't have enough power to keep the network running. And the adjust period is <1week. In the meantime, there'll be a war to exit bitcoin to alts or fiat which would further slow down the already clogged network in a spiral to death.
Yeah, eventualy things would settle down, but a 5-50$ bitcoin would never recover anymore since all the cult believing which is what is sustaining bitcoin today will be gone then. The impact on it's image would be too severe.
This is why POW cannot work long term.

facepalm

dont call out foolish numbers

Well i think it is fiat money that become digital currency, because there are regulator, controler and something are like other fiat money.
That is not digital currency I guess, is like bitcoin and other fair digital currencies. It can be manipulated by government and central bank.
Although maybe it will be more stable than other altcoins, but i am doubt the people at China will use it for investing, i will see until it be launched on the markets.

China doesn`t need a central bank digital currency.They can adopt bitcoin and use it

as a government coin.Their control is total,they have the biggest miners.

You are right in saying that launching a fiat currency will not affect bitcoin too much. That would be a fact if the country involved is not China. China is one of the country that has biggest hold of bitcoins volume in the world. Aside from having a large number of bitcoin users in the populace and big companies that are in the rich list of bitcoin industry they also have the biggest bitcoin mining farm in the world. It is not yet 100% but there is a possibility that during the launch a big dump on bitcoin will occur and a price meltdown will placed upon bitcoin.

This is not something not to be looked upon to, if only it isnt China but it is. And so a panic and a regulation in China will bring about tremendous and huge effect on bitcoin industry.

Price would eventually go down if China would launch its own digital currency and you are right they hold of the most huge amount of bitcoin as of now and they have the largest company of bitcoin miners and if they tend to jump to their own currency then expect that bitcoins price would largely affected.

That has nothing to do with bitcoin. Goverment coin is like any sh&&coin out there.
Bitcoin is global and has strongest super computer in the world backing it up.
They can't beat this ;)

hell no. It will absolutely affect Bitcoin a lot. I believe Bitcoin prices will drop significantly. Although that digital currency is centralized by the government, I doubt that there are still some Chinese who won't invest in this currency. The China main aim is to rule the world and their people also want China to become the strongest country on the Earth. Poor Bitcoin

May sound strange but Chinese controls in many ways BTC, starting with the name of its inventor.

Satoshi Nakamoto is a Japanese name, not Chinese.

China has influence over bitcoin, potentially, via the possibility of regulating either mining or bitcoin exchanges. The impact of both would be limited since a strong negative action by the government in either area would lead to offshoring of either the mining or ownership of BTC. So there would be basically a one-time negative event, and then reduced exposure to Chinese influence thereafter.

So far as controlling the bitcoin protocol, I don't see any evidence that China is a significant player in that respect.