The East is definitely displeased with the dominance of the US dollar in the global financial ecosystem. In the recent BRICS summit, Russia appealed for the creation of a new global financial ecosystem, detached from the US dollar. At that time, many were skeptical about the possibility of other BRICS nations responding favorably to the plan. However, a recent post by cryptocurrency expert Chirag Jetani indicates that for the last few years, China has been secretly executing a similar strategy to counter the dominance of the US dollar. Curious to know more about what China’s plan is? Read on!
China’s Strategic Move in Crypto Control
China banned cryptocurrency exchanges and ICOs in 2017. Later, in 2021, it further tightened its restrictions against the crypto industry by banning crypto trading and mining. Jetani claimed that Chinese investors made nearly $1.15B in gains in 2023. In his opinion, the intention of the ban is not to dismantle the crypto sector but to assert control over the sector.
The Blockchain and Digital Yuan Initiative
Jetani stated that the Chinese president endorsed blockchain development in 2019. He pointed out that right now more than 500 blockchain projects operate under the government. He added that Alibaba, a Chinese multinational technology company specializing in e-commerce, retail, internet, and technology, leads globally in blockchain patents.
Why Does the Digital Yuan Matter?
Jetani presented the Digital Yuan, a digital currency fully controlled by the Chinese government, as a primary tool that China is preparing to use to challenge the dominance of the US dollar. He claimed that this Chinese digital currency is designed in such a way that it could help to reduce dependence on the US-controlled financial systems.
Global CBCS and China’s Blockchain Influence
Emphasizing that China’s blockchain supports 35% of the world’s CBDCs, Jetani noted that China could use its blockchain influence to shape the international digital currency market.
At a time when countries are competing against each other in the global digital currency landscape, there is a high chance that the Chinese blockchain influence over the digital currency ecosystem will continue to rise.
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Impact on Global Finance and Trade
Jetani stated that China’s digital yuan transactions have reached $13.8 billion. According to his post, the Chinese CBDC has nearly 261 million users.
Jetani opined that China’s effort to promote the concept of CBDCs would encourage other countries to rethink their perspective on the global digital currency ecosystem.
The US Federal Reserve’s move to launch FedNow, a service that allows individuals and businesses to send and receive money instantly, was cited as an example of the influence of China’s push for CBDCs.
In conclusion, China’s blockchain and digital yuan efforts reveal its aggressive strategy for financial dominance (not just limited to challenging the dominance of the US dollar), making it essential to understand these shifts in global finance.
Stay tuned to Coinpedia for the latest developments in the global financial landscape!
