The blockchain tide has come, how can the central bank wait to die?


Recently, a word – “blockchain” appears frequently on the Internet, but many people often don’t know the exact meaning. So what is “blockchain”? Recently, it was publicly named.

What is “blockchain”?

In a narrow sense, blockchain is a kind of distributed database which combines data blocks in chronological order and ensures that it can not be tampered with or forged by cryptography. The blockchain can be regarded as an account book, and each block can be regarded as a page account. The “account book” is formed by linking them through the sequence of recording time. The significance of blockchain is to rebuild trust, so as to greatly reduce transaction cost and threshold, and improve the efficiency of economic operation.

Huang Qifan, vice president of China International Economic Exchange Center, cleverly compares big data, cloud computing, artificial intelligence and blockchain technology.

“If we compare digital platforms with people, the Internet, mobile Internet and the Internet of things are just like the human nervous system, big data is like the viscera, skin and organs in the human body, and cloud computing is equivalent to the backbone of the human body. Blockchain technology, like more advanced “gene transformation technology”, greatly improves brain response speed, bone strength and limb control flexibility from the basic level. With the help of blockchain technology, the basic functions and applications of the digital platform will be subversive transformed, which will give a stronger impetus to the economic society. “

Blockchain is known as the next disruptive technology after steam engine, power and Internet. Due to its huge application potential, blockchain is widely used in many fields such as digital finance, Internet of things, supply chain, intelligent manufacturing, digital asset transaction, etc. it has attracted the attention of the international community and has become a new arena among countries.

Under the deep adjustment of the world economic pattern, the world has entered a period of economic development dominated by information technology, and scientific and technological innovation has increasingly become an important battlefield in the strategic game of big countries. Looking forward to the future, the informatization process has been regarded as the top priority by major countries. Taking advantage of the blockchain boom, central banks are working hard to study digital currency and blockchain.

As early as 2014, China has been in-depth promoting the research vein of the central bank’s digital currency. At present, with the approval of the State Council, China’s central bank has launched the digital currency electronic payment (DCEP). It is understood that the central bank’s digital currency is a new encrypted electronic currency system based on blockchain technology. In other words, blockchain is the underlying R & D technology of digital currency. China’s central bank’s digital currency is far ahead of other countries. DCEP is the result of years of technological precipitation in China, which has all the conditions needed for “world currency”.

Low transaction cost

Compared with traditional centralized bank transfer, remittance and other methods, the central bank’s digital currency no longer needs a third-party payment platform for transactions, which greatly reduces the transaction cost, especially for some cross-border payment suppliers, high handling fees become the focus of transactions.

Faster Trading

In the process of transaction, the central bank’s digital currency does not need any centralized organization similar to the clearing center to process transaction data. It is completely decentralized, making the transaction processing faster and more convenient.

High anonymity

Compared with other payment methods, the central bank digital currency adopts the block chain technology to fully realize the point-to-point transaction without intermediary participation. In the completely unfamiliar situation, the two sides of the transaction can complete the transaction without mutual trust. This not only improves the anonymity, but also can protect the privacy of both sides of the transaction, which is also a kind of attack to the network crime.

Compared with the digital currency Libra launched by Facebook, the two have similar advantages in security, design concept, technical structure, etc. However, DCEP is a sovereign digital currency researched by the Central Bank of China. No matter it is issued or circulated, it will be guaranteed by national sovereignty. In terms of cost saving, DCEP has achieved almost all functions of the world currency dollar, and can accurately calculate inflation and other macroeconomic indicators. It also plays a key role in curbing the illegal fund-raising activities such as money laundering, providing convenience for global currency exchange and circulation, and promoting the important position of RMB in the world.

Mark Zuckerberg, the founder and CEO of Facebook, said in a question from the US Congress that China is far ahead of the US in terms of innovative technology, and part of China’s payment infrastructure is far ahead of the US. It can be seen that in the era of digital economy, the United States, as a technology giant, wants to regain its dominant position. Therefore, there is the Libra project developed by Facebook.

The digital currency of the people’s Bank of China is designed with a double-layer operation system. In combination with the existing monetary systems of various countries in the world, under the double-layer operation system, the upper level is guaranteed by the central bank for the credit of the issued legal digital currency, so the digital currency of the central bank has the same economic value and unlimited legal solvency with RMB, which is protected by national laws; the lower level is constructed by different commercial banks or commercial institutions Cheng, in charge of issuing the central bank’s digital currency to the public, while ensuring that the currency is not over issued. The digital currency issued by the central bank focuses on the substitution of RMB paper currency (M0), which ensures that the existing monetary theory system still plays its monetary role.

Looking at the global digital currency, China’s central bank is the most successful at present. Although it hasn’t really come out yet, it shows that China has taken another step in scientific and technological innovation, and that China has occupied a favorable position in the future international financial system.

This article is from linker community

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