Private digital currency like bitcoin is a threat central bank digital currency

[hl5460]

Sheng Songcheng, the author of the article, is a member of the Eleventh National People’s Congress, the Director of the Investigation and Statistics Department of the People’s Bank of China. The article was first published by WSJ China. Jiang Le is the co-author.


http://news.8btc.com/wsj-china-pboc-official-on-6-reasons-of-issuing-central-banks-digital-currency

This is a translation piece, not representing 8btc.

[1715443002]

1715443002

[Swisscoinex]

Of course it's a threat. Anything that the central bankers can't control and that can be used to transfer or store monetary value is a threat to the financial system that's been in place for decades.

Some revealing quotes:

Private digital currency is not endorsed by national credit therefore not a real currency

private digital money supply is relatively fixed, which is difficult to adapt to the needs of modern economic development

Of course they would rather like to inflate it to the moon, as they do with fiat.

[Yakamoto]

Sheng Songcheng, the author of the article, is a member of the Eleventh National People’s Congress, the Director of the Investigation and Statistics Department of the People’s Bank of China. The article was first published by WSJ China. Jiang Le is the co-author.


http://news.8btc.com/wsj-china-pboc-official-on-6-reasons-of-issuing-central-banks-digital-currency

This is a translation piece, not representing 8btc.

Of course they want to get rid of private currencies, it's BECAUSE they want to control everything. Having individual people control their own wealth and not being able to control their money poses a huge risk to the multinational banking conglomerates due to people simply not being under their thumb. As long as Bitcoin can be used, people are really free, regardless of the issues.

[hl5460]

Of course it's a threat. Anything that the central bankers can't control and that can be used to transfer or store monetary value is a threat to the financial system that's been in place for decades.

Some revealing quotes:

Private digital currency is not endorsed by national credit therefore not a real currency

private digital money supply is relatively fixed, which is difficult to adapt to the needs of modern economic development

Of course they would rather like to inflate it to the moon, as they do with fiat.

But it's the first time that the idea was clearly presented by PBOC official.

[hl5460]

Sheng Songcheng, the author of the article, is a member of the Eleventh National People’s Congress, the Director of the Investigation and Statistics Department of the People’s Bank of China. The article was first published by WSJ China. Jiang Le is the co-author.


http://news.8btc.com/wsj-china-pboc-official-on-6-reasons-of-issuing-central-banks-digital-currency

This is a translation piece, not representing 8btc.

Of course they want to get rid of private currencies, it's BECAUSE they want to control everything. Having individual people control their own wealth and not being able to control their money poses a huge risk to the multinational banking conglomerates due to people simply not being under their thumb. As long as Bitcoin can be used, people are really free, regardless of the issues.

What do you expect to happen next?

[~Bitcoin~]

monetary authorities should clearly recognize that the country should start researching digital currency issued by central banks as soon as possible.

People are using bitcoin not only due to technology behind it. People like to hide their wealth to not pay high tax on their hard earned cash, they like to store their wealth in their hands rather than trusting third parties like bank, if you can store bitcoins securely with just one pair of bitcoin address and private key why you should go through all of the lengthy process/verification/inquiry of storing cash in banks which is also not safe like bitcoin. Also there are many reasons for people to love and have high demand for bitcoin which government issued tokens/cryptos can't provide.

So even if they will launch their proposed centralized digital/crypto currency fully regulated by government, they will not see same demand by community like they have for bitcoin.

[Immakillya]

This not just a threat. Its a serious threat to them. If all people.will switch to bitcoin. They are done. Also government can no longer have any access to anyones financial assets. It will kill the banks and will no longer exist if this continue. If they adopt this kind of technology. Maybe its their lifesaver. But i dont think they will do that.

[n0ne]

All private digital currencies won't gain popularity similar to bitcoin or few other altcoins. Within a short period number of digital currencies got into use, but users know only a few. So to save wealth people won't prefer those private digital currencies. Another reason is that several countries have converting their fiat system to digital form, which also neglects such use creating issues.

[Kakmakr]

The Chinese see everything as a threat, even their own citizens. So this is no surprise to us. Bitcoin can be used for capital flight and it can also be used to avoid taxes, but if they regulate it properly, they could actually reap the many benefits from it, for example :

1. Capital generated from mining
2. Capital from Bitcoin tourists
3. Global job opportunities < Internet based >
4. Tax gains from legitimate use of Bitcoin
5. Technological advancement
6. Local job opportunities < Asic development & manufacturing >

There are more advantages than disadvantages. ^smile^

[hl5460]

monetary authorities should clearly recognize that the country should start researching digital currency issued by central banks as soon as possible.

People are using bitcoin not only due to technology behind it. People like to hide their wealth to not pay high tax on their hard earned cash, they like to store their wealth in their hands rather than trusting third parties like bank, if you can store bitcoins securely with just one pair of bitcoin address and private key why you should go through all of the lengthy process/verification/inquiry of storing cash in banks which is also not safe like bitcoin. Also there are many reasons for people to love and have high demand for bitcoin which government issued tokens/cryptos can't provide.

So even if they will launch their proposed centralized digital/crypto currency fully regulated by government, they will not see same demand by community like they have for bitcoin.

Still the mainstream media will promote state-credit-backed currency, which will suppress demand for private currency like bitcoin.

[hl5460]

The Chinese see everything as a threat, even their own citizens. So this is no surprise to us. Bitcoin can be used for capital flight and it can also be used to avoid taxes, but if they regulate it properly, they could actually reap the many benefits from it, for example :

1. Capital generated from mining
2. Capital from Bitcoin tourists
3. Global job opportunities < Internet based >
4. Tax gains from legitimate use of Bitcoin
5. Technological advancement
6. Local job opportunities < Asic development & manufacturing >

There are more advantages than disadvantages. ^smile^

That would be equal to surrender to the enemy in a war of money.

[Dmitry.Vastov]

Bitcoin can be their problem if a massive adoption accured. For now, bitcoin is just being slowly getting to know by people. But i think this is going to be their major problem in the future. They will lose customers and they will close because many will switch to bitcoin. Im sure they have some plans about this. Bitcoin is just starting to be popular and banks should not be worry for now.

[Jet Cash]

Banks have adjusted.

- I get free instant transfers to and from my account, as long as the other account is a UK sterling account
- I get 1.25% interest on a savings account, and I have instant withdrawal from that account
- I have up to 2 months to pay for goods purchased with my credit card, and I get a 0.5% cashback credit on most purchases.

Bitcoin can't compete with this, and Bitcoin payments take longer to confirm. So why do I think Bitcoin is so good? It's international, and it isn't based on a fiat currency.

Are banks worried about Bitcoin? I suspect not. I think they see the tested technology as something they can adopt to their advantage to save costs and gain more control. The new Royal Mint Gold shows the way governments and banks will move to force/persuade customers to switch from cash.

[chesatochi]

I read the document rapidly and you find only the negative side that bitcoin provide for the Chinese government or any other governments. I think they are scared a little because they don't have the control of the bitcoin currency. But I don't think any fiat currency will disappear overnight, both will still exist for a different purpose.

[davis196]

Sheng Songcheng, the author of the article, is a member of the Eleventh National People’s Congress, the Director of the Investigation and Statistics Department of the People’s Bank of China. The article was first published by WSJ China. Jiang Le is the co-author.


http://news.8btc.com/wsj-china-pboc-official-on-6-reasons-of-issuing-central-banks-digital-currency

This is a translation piece, not representing 8btc.

I don`t understand the whole idea about central bank digital currencies.

Why central bank need to create their own digital currencies?

The only reason is to kill bitcoin.

[freshman777]

What do you expect to happen next?

With 70-80% of mining concentrated in big datacenters in China, it's very easy for Chinese officials to control the current implementation of Bitcoin.

Transactional throughput of Bitcoin is limited, they don't mind Bitcoin because it's small.

If transactional throughput issue is resolved and Bitcoin can grow technically beyond the current crippled implementation, the Chinese mining datacenters will have to comply with whatever requirements they receive from authorities. Most likely requirement is to allow processing of only whitelisted transactions from identified users, the rest of transactions blocked. At this point Bitcoin should fork off from sha256 hashing or lose its purpose. At this point altcoins that do not depend upon Chinese mining datacenters will take a nice market share from Bitcoin, the idea of cryptocurrency won't die with Bitcoin going under.

[sportis]

Of course what did he say in other words? We love blockchain technology, we love digital currency (It's better than fiat to control people's wealth and has minimum cost ) but take a look at next quotes

Monetary authorities have the natural advantage of issuing the central bank’s digital currency.

Only the central bank’s digital currency, which is universally accepted by the whole society...

... the future central bank digital currency will likely be the standard currency for a combination of technologies such as blockchain, mobile payments, trusted cloud computing, cryptographic algorithms, security chips and so on

that is, we don't want decentralized currency we don't want to control your money we don't want sheep without the shepherd.

[aso118]

We are talking about China here. A country which is paranoid about the internet and wants to have its own sanitized version of the internet,
How can we expect them to have a different view about private currencies?

Private digital currency is not endorsed by national credit therefore not a real currency.

Phrases like these sound like the official propaganda machine at work.

[QuestionAuthority]

I think you've got that backwards. Central bank digital currency is a threat to private digital currency.

Circle stopped accepting Bitcoin but not before they learned everything they needed to know about the blockchain (clearly the best feature of Bitcoin). Circle has always primarily been a fiat payment system that also took Bitcoin. Their main use is to allow people to send money around the world in any currency (dollars, euros, pounds or whatever) for absolutely NO fee. You can text someone an emoji and have money hidden behind it or just text them money. They have two factor authentication and are FDIC insured. There's no limit on how much you can send and all you do to sign up is take a pic of your debit card. Its ridiculously simple to use. As far as I can tell, they are the only true competitor to Bitcoin without the transaction fee.

I just sent $500 to my daughter 3000 miles away for Christmas. I used Circle and it took 20 seconds to send, was hidden behind an emoji of a Christmas present, took her 30 seconds to transfer to her bank account and had absolutely NO fee whatsoever (no exchange fee, no transaction fee, no withdrawal fee, no deposit fee, a completely free service). How the fuck is Bitcoin ever supposed to compete with that?

Of course, we will shun them because we worship at the alter of Satoshi. The rest of society will like Circle because it's easy, insured, has no fee and uses your current bank account.

One other thing, I've attempted to call almost every exchange in bitcoinland since Tradehill and was never able to talk to a person. Before I set up my account I called circle and they answered my call in one ring and answered all my questions.

Here are their support numbers if you want to give it a try.

US +1 800 398 7172

Canada +1 800 398 7172

Europe

UK +44 1793 250273

Ireland +353 76 888 6385

Austria +43 720 116408

Denmark +45 89 88 48 73

France +33 9 75 18 69 39

Italy +39 045 786 0905

Netherlands +31 85 888 6879

Poland +48 22 307 23 72

Portugal +351 308 804 274

Spain +34 518 808 538

Asia Pacific

Hong Kong +852 58089373

Japan +81 345606551

New Zealand +64 6 880 6119

[rapazev]

The Chinese see everything as a threat, even their own citizens. So this is no surprise to us. Bitcoin can be used for capital flight and it can also be used to avoid taxes, but if they regulate it properly, they could actually reap the many benefits from it, for example :

1. Capital generated from mining
2. Capital from Bitcoin tourists
3. Global job opportunities < Internet based >
4. Tax gains from legitimate use of Bitcoin
5. Technological advancement
6. Local job opportunities < Asic development & manufacturing >

There are more advantages than disadvantages. ^smile^

but this isnt just chinese government, every central bank is "against" bitcoin.
i do agree with all you said about the benefits, but, the hardest part is to control that.. how to properly regulate it?