China's Masterplan to Destroy Bitcoin, Digital Yuan

As the whole world continues to fight the COVID-19 pandemic, China has long beaten the virus and has quickly resumed destroying Bitcoin before any other government could keep focus. Who will win? The old god Bitcoin or the newly introduced Digital Yuan? But whoever wins, it is no problem at all because it is a healthy competition that would do wonders for us all, as they both set to remove the crooked banks once and for all. At least we would be done with the crazy centralized financial systems that have been robbing us for years.

So, we'll first discuss how China started the war against BTC.

China's War Against BTC Has Started

Since the time when BTC was just valued at 0.0007 USD, the very idea of digital yuan has been growing on and on. And the relation between China and Bitcoin can well be termed as a bittersweet love story which has seen ups and down, distortion and patch- up in terms of faith and interest.

Then, in December 2013, the People’s Bank of China took its first official decision by declaring transactions in Bitcoin as illegal. And all financial institutions were informed of the verdict. As a result of this, several decisions came out that subsequently discouraged bitcoin mining and trading in China.

Crackdowns were made and legislation was put forward to declare bitcoin wallets, exchange, sell and purchase illegal in the People's Republic of China. The war against BTC breaks.

Unsurprisingly, the one cryptocurrency that the Chinese government doesn’t seem to have an issue with is its proposed central bank digital currency (CBDC), for the fact of it being centrally managed, governed and controlled by the government itself.

Even though Facebook’s release of the Libra project has not been taken well by the wall street pundits but the test of digital yuan urged China to look for another way of conquering the Finance world and speedup their quest before any other government could do that. This time, not by a product, or service but by the revolution the very purpose of business, the currency.

As reported by The Wall Street Journal, China has rolled out a pilot test of digital currency on its promising Blockchain Service Network (BSN). And laid down the foundation for injection of electronic payment system into the traditional banking infrastructure.

This will be a huge set back to bitcoin miners as the country has not only declared Bitcoin illegal but it is planning on launching its digital currency which would soon be challenging Bitcoin in global business infrastructure.

China’s plan for Digital currency DCEP announced 5 years ago, seems to be nearing completion. Digital Currency DCEP (Digital Currency Electronic Payment) is a national digital currency of China built around and based on modern Blockchain and Cryptographic technology.

There are several differences between DCEP and existing cryptocurrencies such as bitcoin, according to Terry Liu, CEO of VoneChain Technology, a blockchain consultancy based in Shanghai that is collaborating with national agencies regarding this project rollout.

First, DCEP in contrast to Bitcoin is centralized. Bitcoin is mined and controlled by an algorithm. Anyone with high performing processors can contribute to solving the algorithm and receive a portion of bitcoin as a reward. But DCEP is planned to be government-sanctioned and circulated through the traditional banking system to its customers and gradually overtaking the conventional paper bill and coins.

The underlying basic infrastructure would be centrally controlled monitored and regularized by the government and not distributed across the system in case of bitcoin and other blockchain currencies. Centralization would ideally eliminate any time lags or hindrance associated with transactions, hence enabling its use practical for daily consumer and everyday business transactions.

Following China’s plan for the distribution of digital currency to its citizen through the supply chain of the traditional banking system would be so seamless that most consumers would hardly notice any difference using china’s digital yuan and existing digital payment platforms including Alipay or WeChat Pay.

China’s cryptocurrency advancements will inevitably pave a firm path for other nations to follow into the world of digital currency and undermining the traditional paper money. That's sure.

https://asiatimes.com/2020/02/inside-chinas-mission-to-create-digital-yuan

True Reasons Chinese Govt Wants to Launch Digital Yuan (To control global money and enforce social credit system)

“From a regulatory perspective, the emergence of a digital currency would enable payment transactions to be made online, making all cash flow in society traceable, “said Xu Yuan, a senior researcher with Peking University's Digital Finance Research Centre.

When business activities, exchange, and transactions are moved online and data storage is enabled to a centrally organized system headed by the government, the credit system for overall society will be easily determined and standardized for the public altogether.

“In theory, following the launch of the digital yuan, there will be no transaction that regulatory authorities will not be able to see – cash flows will be completely traceable,” Xu said.

Business and the daily consumer would use a centralized technology to carry out direct, instant payments to each other using digital currency.

In essence, every individual and organization will have a social credit score that is improved by actions that are determined to conform to standards, procedural rules, legal requirements, and reduced by unfitting actions.

The target is to create, manage, oversee and regulate a centralized government system with a “unified social credit code” and citizens having unique citizenship numbers, having all accounts linked to a centralized system including bank account, traffic licensing, and many more.

All records will be logged and stored centrally into a government-owned system and will be easily available for reference when required.

China is determined to implement and enforce its social credit system, now more than ever.

In the hope of building high-trust society, the Chinese government will use big data across the various data servers across the country ranging from banking, education, driving license, and many other data centres to ensure abiding of law by the citizens and businesses.

The corporate social credits system targets the corporate sectors of the country. The system collects, compiles, and presents data from business firms to a scale that determines rewards and penalties depending upon performance, quality of service, and other Key Performance Indicators (KPIs) put in place by the government.

According to a report from the European Chamber of Commerce, businesses and other organizations gather data on their operations and submit them to relevant local and national authorities, who then aggregate and store the data in the National Credit Information Sharing Platform, which is a centralized database.

Companies with poor scores face several penalties, warning and eventually making it to the blacklist if found guilty of not complying with standard procedures and KPIs.

The social media credit system can truly be linked with China’s effort to eradicate corruption, money laundering, and other curses of the business world that hamper the overall turnout for the fiscal year. Who knows?

How Digital Yuan Is Set to Beat Bitcoin

Several aspects need to be considered when deciding the winner in this battle of cryptocurrency dominance.

After the thorough implementation of digital currency throughout its banking system, China can proceed towards making the digital Yuan more accessible and usable across the borders. This would fuel foreign interest with this digital market and help china elevate the value of its digital cryptocurrency.

If China succeeds in the successful implementation of centralized digital currency across the country and getting hold of every single transaction happening inside the border, this can catalyze the eradication of corruption, money laundering, tax evasion.

Only the government can practice its power of forcing the banks into taking this path to digitalization. Also, we might witness a day where governments can send money directly to the wallets of its citizens rather than to the banks.

It is believed that China can force its trading partners to employ the digital yuan in place of any other currency for trade and business with Chinese business entities and soon after, this would force mandatory adoption for the usage of digital yuan worldwide when there will be no other currency on the table other than digital Yuan.

Blockchain investment and research can be more powered after the interest of the world’s superpowers. This would itself prove to be a guiding light for the next industrial and technological revolution for mankind.

Cryptocurrency is the inevitable truth we must make peace with, in the coming future. This COVID-19 pandemic has made us rethink our interactions and business standard procedures. And China is surely winning the battle of conquering the post-pandemic business world through the release of digital yuan on its Blockchain Service Network (BSN). What do you think will happen once the digital yuan starts gaining market capital?

www.youtube.com/watch?v=JkMsrr4hg5E
https://www.china-briefing.com/news/chinas-corporate-social-credit-system-how-it-works