China has been the talk of the cryptocurrency town over the past few months, and the hype does not seem to be dying down anytime soon. In the space of weeks, the Chinese President XI Jinping and an official from the Chinese national bank both spoke about the benefits of blockchain technology and how it was the next step in the financial revolution.
This announcement was also met with trepidation from some sectors of cryptocurrency proponents as they claimed that blockchain would allow for the Chinese government to have a free pass to its citizens’ data. Addressing that very sentiment, the central bank publicly commented that the newly proposed state-backed cryptocurrency would not be taking full control of the user data.
China has decided to call its cryptocurrency the Digital Currency Electronic Payment, which will be powered by blockchain technology and integrated into several digital wallets.
The government has admitted that there will undoubtedly be a check on the transactions to prevent malpractices, but if a specific user does total demand anonymity, it will be accepted. This was also reiterated by Mu Changchun, the head of the People’s Bank of China’s digital currency research institute when he added that freedom is essential, but so are ethical codes. He said:
“But at the same time we will keep the balance between the ‘controllable anonymity’ and anti-money laundering, CTF (counter terrorist financing), and also tax issues, online gambling and any electronic criminal activities. That is a balance we have to keep, and that is our goal. We are not seeking full control of the information of the general public.”
There has not been any definite date set for the launch of the state-backed cryptocurrency with multiple obstacles clouding it. Changchun had earlier claimed that the asset was almost ready to launch but turned tables in September when he said that there was more work left to be done on the rollout.
The Chinese institutions explained that the reason for the delay was that they wanted to get everything right and then create a new system that will solve China’s financial problems.
The Asian giant had recently made its stance on Bitcoin, also evident when the state-run newspaper, Xinhua ran a piece called Bitcoin, the first successful application of blockchain technology. The article touched upon how Bitcoin works and what its underlying foundation was in connection to mainstream currency. This was not the first time that a Chinese newspaper had praised Bitcoin as The People’ Daily had recently called blockchain “a breaking point” for the country to surpass.
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