China has been known to shut itself off from the relatively newly emerged financial revolution- The Blockchain revolution. Several bans around the crypto activities, Initial Coin Offerings, etc. have prevented the country to participate in the crypto sphere despite the boom in the industry. Since the inception of Bitcoin back in 2009, there has not been an open embracing attitude towards cryptocurrency from China.
— Justin Sun (@justinsuntron) June 26, 2019
Encouraging China to participate in the historic event in the crypto sphere-
Recently, one of China’s leading news outlet pointed at this situation and has tried to encourage the country to participate at least now in the booming financial revolution. In order to encourage, it sited Facebook’s native cryptocurrency- Libra as an example. Facebook, as we all know, is the social media giant. Now, the native cryptocurrency from the giant platform is ought to have a bigger impact on the crypto land for obvious reasons. The stablecoin is anticipated to arrive in the coming year. This marks an important potential historic event in the crypto-history. The local news outlet has tried to emphasize the importance of China to participate in this upcoming ground-breaking time in the crypto sphere.
Preparations for the potential crypto-historic time-
- Facebook aims to gather one hundred members before Libra gets released.
- By far, it has already formed connections with twenty-eight partners that include Visa, MasterCard, Uber, PayPal, and so on. This will help the giant to run the internet nodes for authentication purposes.
- There are anticipations that Facebook’s Libra may have to jump through many regulatory hoops from various countries and policymakers, in order to become an international name. To cut the chase, there are predictions that the company may try to reach a deal with the U.S regulators and authorities to keep the international regulatory pressure as far as possible.
The fact that such a giant such as Facebook is behind Libra’s launch, this has stirred several market-experts to predict that this launch will prove to be a highly important event in the history of cryptocurrency, after Bitcoin of course. The launch of the stablecoin is expected to increase the competition and technological development in the industry, as per market experts.
Why China must participate?
The news outlet further pointed out that China’s non-participation in the financial developments can cause it to harm as well. For instance, the absence taxed the country from being a strong contender in the finance and the currency circulation in the past. This gave space to the United States Dollar to obtain dominance in the finance market. The news outlet pleaded that history should not repeat itself.
- The lack of participation can lead China to a passive spot within the crypto competition.
- There are high chances that the country may have to miss benefits related to the internet and the blockchain technological areas, due to the lack of participation.
- Participation in the digital competition, on the other hand, becomes a must because soon the digital currency will become ‘inevitable.’ Ignoring it will translate into choosing to become obsolete. The digital economic competition has the potential to impact the worldwide economy, technology, and the overall economic infrastructure.
- Years of effort has gone into for Chinese internet companies to pin their name on the global map. This has benefited the country’s economy to reach over the mark of 4,36 Trillion U.S. Dollars. The participation holds the promise of further growth for the country.
Why Libra is the reference point?
- Well, there have been so many companies, financial institutions who have tried to release their own native digital cryptocurrency, or stablecoin, or any crypto related asset, or services. But still, their scale of success and Facebook’s scale of success has quite a huge difference.
- The second reason that sets Libra apart is the fact that it is backed by securities and currencies, which give it an extra layer of stability and trust in comparison to other cryptocurrencies. This very point makes Facebook’s Libra have the potential to change the face of blockchain technology and hold a strong influence on the digital financial economy on an international scale.
- As per several reports, FB has the ‘seigniorage power’ for building a cryptocurrency for 2.7 billion users around the world. This capacity gives a lot of central power to the company in the crypto sphere.
- Libra’s success is also the U.S’ success. The dominance of the country in the financial world economy can now get upgraded to the strong presence in the digital financial crypto scape.
- Further, if Libra gets a green flag from the U.S. regulators, then it will open routes for Libra to seep into various economies around the world.
China’s need for regulation is fair and can be balanced with a healthy mutual consensus between regulatory bodies and the country’s industries.