China’s claim that its cryptocurrency rival to Bitcoin is almost ready for launch has been branded as nonsense by some of the region’s crypto observers.
Earlier this week, the deputy director of the People’s Bank of China (PBC) – Mu Changchun – hinted at an event in Beijing that the cryptocurrency was “very close to being out” and that the bank itself would be the issuer of the digital asset.
In a Coin Rivet article for the Daily Express, it was reported that the Chinese government has been working on the project on-and-off for nearly five years, despite publicly eschewing Bitcoin and other global cryptocurrencies.
The crypto narrative from the political corridors of Beijing has been ramped up in recent weeks to the point of almost suggesting the new digital coin has been designed to replace the physical Chinese yuan within two years. But that, say experts, appears totally implausible.
“There’s a massive potential cost for any nation facing the prospect of being late to the party with building a cryptocurrency infrastructure,” trader and exchange analyst Emile Shihao told express.co.uk.
“Over the next few years, it is likely that cryptocurrencies will become mainstream, and China – being the technologically advanced nation that it is – will naturally want to be at the sharp end of advancing that technology.
“But, in my opinion, something doesn’t quite add up with either the way the PBC is presenting this move or the very wild claims we’re hearing – some of it doesn’t make sense.”
One aspect of the many claims about the BTC rival and its ability to replace China’s physical currency that grates with observers is the fact that it will almost certainly rely on mobile phones.
As advanced as the nation is with mobile phone technology, there is a fundamental flaw in the plan.
“One and a half billion people live in China – but more than half of that massive population do not own a smartphone,” explains banker Chi Gang.
“The government is talking about creating an asset that will overshadow Bitcoin, and yet it couldn’t possibly do that because it simply has zero chance of being widely available to the people.
“China is nowhere near ready to execute this over-ambitious plan, and the claims of Mr Mu Changchun just simply don’t hold water – it’s nonsense.”
Despite the criticism, the PBC maintains it is pressing ahead with taking digital currency mainstream. It was recently revealed the bank had registered several patents relating to crypto wallets designed to exchange yuan for a new cryptocurrency under the PBC’s control.