Cryptocurrencies are becoming more and more acceptable for governments worldwide. This has been the case with the US and Europe for a while but China always stood out as hostile against cryptocurrencies. Blockchain, the technology behind cryptocurrencies has a lot more to offer than just smooth money transfers. Blockchain can be used for tracking all different types of transactions and movements and it’s increasingly used by large enterprises to make the process of product development and movement more transparent and accessible. Blockchain also makes things a lot faster by removing the middle man hence decreasing the importance of bureaucratic procedures.
China has never really favored cryptocurrencies in the past it has refused to provide services for the companies working with cryptocurrencies but now these attitudes seem to be changing. Meanwhile, entities like European union are constantly working on trying to come up with a cost-efficient way to integrate blockchain into their everyday routine and to improve the quality of governance as well as its transparency.
The adoption of cryptocurrency and blockchain isn’t necessarily new or exclusive to China. Countries across the world have accepted bitcoin or other cryptocurrencies as payment for years now. Starting from escape rooms, casinos and most notably Australian online casinos like Gunsbet accept Bitcoins, you can pay for a variety of entertaining activities by crypto pay. China has ambitious plans to become the leader in blockchain adoption and to secure its place as the number one technological innovator in the world. China’s main rival in this is the US which has had a completely different approach to cryptocurrency and blockchain. The US has been quite accepting of cryptocurrency while leaving blockchain out of its governance.
Although it must be said that major American companies do use blockchain to simplify their procedures but the government officials don’t seem too keen to bring this technology into politics and governance. Cryptocurrencies have taken off in America not because the government necessarily endorses them but because companies can benefit from using blockchain technology. Even now, When discussing Facebook’s new cryptocurrency Libra, Mark Zuckerberg tried to convince the government officials during a 6-hour interview in Congress that if Facebook’s cryptocurrency does not get the support, or if America doesn’t support blockchain adoption and cryptocurrency normalization China would take the leading role in this.
Zuckerberg’s predictions were confirmed by China’s recent decision. The president of China Xi Jinping has publicly announced that the country will aim to become the leader in cutting edge technology. As a part of this grandiose plan, China has supported the collaborations between Peoples Bank of China and HUAWEI- a telecommunications giant, to collaborate or research on blockchain adoption. The People’s Bank of China is also said to have plans to launch its own cryptocurrency, which will be more regulated considering it will be a government-issued cryptocurrency.
In one way or another, the whole world is supporting the use of blockchain technologies, but that doesn’t mean that blockchain will entirely replace other practices or technological advances. The most efficient approach would be to integrate blockchain as a part of the governance sort of take the best of both worlds to deliver the best results that will integrate the transparency and the efficiency of blockchain with the orderly procedure of traditional government. Additionally, it’s good to know that adopting blockchain does not mean completely removing all “middleman”. It’s just these positions that will have to change the way they operate to adapt to the new standard because if this technology will be adopted to a large scale the supervision will be absolutely necessary.
Featured image: South China Morning Post