People’s Bank Of China (PBOC) has expressed yet again its stance about cryptocurrencies. A new paper about the subject has been written by the director of their research unit. The report treats cryptocurrencies as a failure. In this paper, he states that cryptocurrencies are inferior to fiat money and that digital currencies will advance as a fiat substitute.
PBOC Does Not Like Cryptocurrencies
The People’s Bank of China has outlined again their stance about cryptocurrencies yesterday. Its director of research released a paper named “What can a blockchain do and not do?”, where he gives a negative approach to the issue of cryptocurrencies.
According to Xu Zhong, the author of the paper, the current downsides of how cryptocurrencies work are more significant than the possible advantages they can offer. The paper explains why China has taken its actual stance on Cryptocurrencies. It also makes a very important distinction between blockchain and cryptocurrencies.
According to reports and translations, the paper states that blockchain will have little to no influence in the economic and monetary system and that cryptocurrencies have no intrinsic value. This is in line with the stance that China has taken since the cryptocurrency trading ban that happened last year.
China Stance On Cryptocurrencies
China has had a hostile stance on cryptocurrencies since the last year when they banned cryptocurrency trading in Chinese soil. But before that, cryptocurrency had a great hold in China, with more than the 95% of the trading volume. But now that the ban is in full force, China constitutes less than 5% of the total cryptocurrency trading in the world.
However, they have still most of the cryptocurrency mining industry inside their borders, and Bitmain, the most prolific cryptocurrency mining hardware manufacturer, has its base of operations in China. But unlike other countries, China has a different stance on the blockchain.
Blockchain Good, Cryptocurrency Bad
To them, blockchain is a really interesting technology that has a myriad of applications different than cryptocurrencies. They are even supporting blockchain startups by offering money to finance reliable projects. These projects could serve for the future operations of the Republic. The blockchain has also been referenced by the Chinese president Xi Jinping as a breakthrough technology.
The report also exposes this belief. The author says that while cryptocurrencies won’t have an impact on the financial side of things, applications of this tech could help to fix some problems for the society in the near future.