Cryptocurrency. Bitcoin, Litecoin, Ethereum and the many lesser known altcoins will soon have another to contend with. After closing all exchanges and creating a virtual ban on Bitcoin in 2017. The People’s Bank of China has announced they are close to issuing their own digital currency. The new currency will comply with all of China’s regulations regarding laundering and fraud and will be based on a two tier system, involving the bank and other state run financial institutions.
Of note to those involved in crypto, the new currency will not be based on blockchain technology alone, due to fears it would be unable to handle the volume of transactions.
It is exciting to see a major nation like China step up and adopt crypto as a valid means of payment. However, it is also concerning that having banned all other crypto currencies, only the state issued one will be accepted. Further questions need to be answered. where are user wallets stored, who is allowed to mine, will we see the source code, and will there be any exchanges to other currencies. The Chinese government is a known currency manipulator, who is to say we won’t see the value artificially bubble and inflate the price especially with the government being the major coin holder.