When it comes to cryptocurrencies, China has already declared its stand by prohibiting virtual currency activities within its borders. Unfortunately, with its current stand, China is falling behind in the global crypto revolution.
China is once again popping up in crypto discussions
Since Facebook released the whitepaper for its stablecoin meant to act as a global currency, China is popping up in discussions all over again. As per the white paper, the social media giant has inked partnerships with global brands such as Uber, Mastercard, Paypal, and Visa, who will manage Facebook’s stablecoin. Even though the stablecoin is yet to be launched, the coin is viewed as the next-big-thing after Bitcoin’s birth over ten years ago. Currently, Facebook already has 28 partners and aims to scale the number up to 100 partners who will help in validating transactions.
With Facebook adding momentum to the global crypto revolution, China is missing in action. For example, Chinese companies are conspicuously missing from the list of partnerships that Facebook is seeking for its stablecoin. The United States is already on the forefront in this landmark event, which resembles what it did in the past to control global finance. In the US, reputable finance institutions like JP Morgan have been striving to launch a stablecoin. Unfortunately, Facebook is arguably the most influential firm, and China needs to be involved.
What if China is left behind during the global crypto revolution?
Global Times, a media news site, noted:
“If China cannot participate in this new phase of the digital economic revolution, then it may find itself in a passive position within currency competition, not to mention it could lose its advantage within the internet and financial technology sectors.”
Unlike other stablecoins and virtual currencies, Facebook’s coin will be backed by securities and a basket of currencies. Consequently, experts argue that the coin will be more stable and reliable. With over 2.5 billion users, Facebook may be moving to create a central bank which will fuel the digital economy.
China fears the negative side of cryptocurrency
China’s citizens are still interested in crypto. For example, a recent report by Diar noted that China leads the United States in USDT trading. Not only that but key figures in the community and businesses are often Chinese run and have their heads from the nation, like Justin Sun and Changpeng Zhao. Yet its government is not.
From a distance, China is seemingly concerned that digital currencies can be used to fund terrorism and be used to launder money. But as it fears to get involved, its financial technology sector also needs stringent measures to ensure financial stability.
However, with the global crypto revolution fast approaching, financial watchdogs in China need to have a deeper understanding of cryptocurrencies, which will ensure that China is not lagging in the imminent global crypto revolution.