‘Renminbi’ the Official Chinese Currency to Become a Cryptocurrency

'Renminbi' the Official Chinese Currency to Become a Cryptocurrency

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On 7th April, Bloomberg had an interview with the executive chairman of the Blockchain Research Institute, Donald Tapscott. In the interview, Tapscott said that China’s official national currency, the renminbi (RMB) would become a cryptocurrency soon. Tapscott further talked about the meeting he recently had with the chairman of the Communist Party in China. He said China’s President Xi Jinping believes that blockchain is amongst the most promising technology for the country in the soon future.

Some years ago, China had banned all forms of digital currency exchanges so as to guard against risks from Bitcoin speculation, money laundering, and other illegal activities. Tapscott further said that the government is now set to ban cryptocurrency mining as well.

He bragged that the government is taking practical measures to completely forestall the operation of digital currencies nationwide, putting a final stop to buy Bitcoin among others. In his words,

“It’s not really necessary to do that (to ban exchanges and mining) because in 20 years we are not going to be using bitcoin in China. Chinese people will use the RMB; only the RMB will become a cryptocurrency. The Central Bank of China will turn it into a digital currency”.

Tapscott was then asked whether decentralized exchanges (DEXs) would operate in the country. He responded that DEXs would, in the long run, dominate over centralized ones. He explained that his optimism is hinged on the fact that DEXs has the ability to identify and deal with bad activities better. All assets, even customary ones such as securities would be available on decentralized exchanges.

Chinese experts have since been conceiving the thought of annihilating digital currency mining in the country and are now having serious talks on the issue. The Nation Development and Reform Commission (NDRC) has in its draft, included crypto mining as part of the modified list of industrial activities that have been earmarked for closure because of their inhabitable manufacturing conditions, resources wastage as well as environmental pollution.

Despite these plans, China still remains a major player in the Bitcoin space with many of the popular bitcoin mining pools. For instance, Bitmain, a crypto mining operator worked above 11 mining farmsteads in the country as at mid-2018. He would thus be greatly affected by the new NDRC proposal.

Regarding blockchain, China is reputedly holding the largest number of blockchain projects in the world. The country has 263 blockchain-related projects which account for a whopping 25% of the world’s total blockchain related projects.

In the previous month, a multi-year project which was called the “Implementation Plan for the Promotion of Transportation Infrastructure Development” was inaugurated in the province of Jiangsu. With respect to the plan, blockchain would be one of the innovations and strategies that local authorities would employ in overhauling as and redesigning infrastructures of local transport.

The former president of the Bank of China, Li Lihul, however, said that should include the new financial innovations cause any infringement to the interest of the consumers or the stability of the financial market as a whole, regulators will step in for sure.

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About Ali Raza

A journalist, with experience in web journalism and marketing. Ali holds a master degree in finance and enjoys writing about cryptocurrencies and fintech. Ali’s work has been published on a number of cryptocurrency publications.