Over the past few months, there have been reports that China might be willing to reconsider the ban it has placed on certain parts of the crypto industry in a bid to not lose out on the benefits of this innovative technology.
However, the Global Times, a subsidiary of the Communist Party of China’s official tabloid the Peoples’ Daily, is now refuting this notion. In an official tweet posted yesterday, the tabloid, whose Editor in Chief is perceived by many to be well connected to the ruling party in China, revealed that any reports that Beijing is working on a state-backed cryptocurrency are “inaccurate.”
As stated earlier, the speculations of a state-backed crypto-asset coming from China have been rampant in the past few months. Both official and non-official reports have swirled this month alone, all of which have hinted at the arrival of a crypto product from the Chinese government.
For instance, the Peoples’ Bank of China (PBoC) published a statement on August 2, proposing that it would accelerate research into the development of digital currency, as it feared that Facebook’s Libra stablecoin could consolidate the dollar and increase its influence.
The announcement was rather understandable; both China and the United States have been involved in a battle for economic supremacy for the better part of three years now, and given the dicey trade dispute in which both countries are locked in, everyone will be looking for an advantage; no matter how seemingly little.
While cryptocurrency exchanges, Initial Coin Exchanges (ICOs), and cryptocurrencies themselves have been banned in China for some years now, it is only logical that in the wake of a crypto-assisted consolidation attempt by the United States, they get in on the industry as well.
By August 10, Shanghai Securities News reported that Mu Changchun, the Deputy Chief of Payments at the PBoC had stated at a forum that the bank had developed a prototype digital currency that runs on a blockchain architecture.
In addition to that, China Daily, another news medium controlled by the Community Party of China, reported just last week that the launch of the state-backed digital currency was being accelerated due to the looming arrival of Libra. Forbes subsequently reported that the PBoC was planning a selected first-round distribution of its cryptocurrency to top tech firms such as the Alibaba Group and Tencent, as well as major banking institutions.
Citing anonymous sources, Forbes further claimed that the coin’s technology was completed and ready to be shipped, in anticipation of a November 11 rollout. Now, if the tweet from Global Times is anything to go by, it would appear that we have been fed wrong information all month long.
At the moment, no one seems to know what to believe. However, one sure truth is that a pivot into crypto by China will be beneficial to everyone. The country is a notable tech market, and from all indications, Bitcoin trading and other crypto activities will most likely thrive there as well. Plus, there’s the ability of the Chinese government to gain equal footing with Washington once more.