After Years of Vilifying Bitcoin, Now the Mainstream Media Sees it as a Savior for China’s Monetary System
by Kenneth Schortgen, The Daily Economist:
First they ignore you, then they laugh at you, then they fight you, then you win. These were the words of a famous revolutionary who used non-violent protest as the means to overthrow the British Empire from its hold over India.
Now in 2017 there is another revolution going on that is for the future of the world’s money. And where even as recently as three years ago the mainstream establishment media was both scoffing at and vilifying the advent of crypto-currencies and those who embraced them, on Feb. 27 that same mainstream media is now hailing Bitcoin as the potential savior for the monetary system of the world’s second largest economy.
China’s new bank regulator, Guo Shuqing, is by all reports the reformer the second-biggest economy desperately needs. His 17 months as stock market watchdog served up so many directives so rapidly that traders called him “Whirlwind Guo.”
He arrives on the banking scene at a moment when China’s financial system is in a whirl of its own. The immediate challenge – murky, debt-laden banks threatening China’s economic outlook – is well known. But a longer-term threat, an existential one, is landing along with Guo: a Chinese government version of Bitcoin that makes you wonder if the nation will even need banks in 10 years.
In creating its own cryptocurrency, Beijing is taking the whole if-you-can’t-beat-them-join-them concept to new heights. Earlier this month, the People’s Bank of China sent shockwaves through Bitcoin circles by halting withdrawals and bringing the heads of cryptocurrency exchanges in for a good talking-to. Then last week, the PBoC announced it’s going digital in a big way. As China mints its own block-chain medium, will it ban Bitcoin transactions? Given the tight correlation between zigs in the yuan and zags in Bitcoin values, the PBoC’s entry could be a game changer – and not necessarily for the worse. – Barron’s
