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China Is Set To Launch A Legal Cryptocurrency In The Second Half Of 2019

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China Is Set To Launch A Legal Cryptocurrency In The Second Half Of 2019

China is swiftly working its way through the path of cryptocurrency adaptation, and although already existing digital currencies may not have gained the needed regulation from China, a new digital currency will be favored with this perk.

Scheduled to fully launch in the second quarter of 2019 which would be anytime from now, it was disclosed at the Central Bank’s work video conference, the legal cryptocurrency which is backed by the central bank of China is already hastening its research to fuel the development of the envisioned digital currency.

Huang Zhen, director of the Institute of Financial Law at the University, has recently revealed that the research institute for which was established when Zhou Xiaochuan was governor, was intended for this purpose. 

He said ;

“The idea of ​​the central bank to issue digital currency was already deployed when Zhou Xiaochuan was the governor of the People’s Bank of China, and the digital currency research institute was established, which also has basic conditions.”

Speaking to the a Chinese media outlet, Wu Changhai, the deputy dean of the Institute of Capital and Finance of China University of Political Science and Law explained that although the idea behind  the new digital currency is to substitute the functions of fiat currencies, its delay is as a result of the Chinese government whose laws are yet to permit cryptocurrencies to function as legal tenders thereby restricting distribution rights.

In his words ;

“The legal digital currency is a substitute for banknotes. It is issued by the central bank. The general encrypted digital currency itself does not have a monetary function. The government cannot hand over the currency distribution rights to a company. This idea is impossible to achieve for a long time. “

Did Libra Trigger this move?

After the hype birthed from Facebook’s Libra coin which is currently on hold, different countries have begun to consider the possibilities of issuing their own legally backed cryptocurrency in order to increase its economy’s infrastructure as a key player in the role of finance and digital technology.

Therefore, it is no surprise that this may have triggered China’s move to hasten its own. In a conclusive statement that could be interpreted as an acceptance of digital currencies, Wu said ;

“We should take the initiative to participate in this new competition in the digital economy. We should further liberalize the academic and technical discussions on encrypted digital currencies and rapidly raise the level of understanding of the digital economy competition among Chinese industry players”.

Cryptocurrency

Crypto Researchers Concerned About The ‘Centralized Structure’ Of The Binance Smart Chain

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Crypto Researchers Concerned About The 'Centralized Structure' Of The Binance Smart Chain

Binance Smart Chain has been rising in popularity as interest rates from different parts of the world, including South Korea, sent the network’s transaction records to new highs. However, this has not deterred analysts’ from pointing out the increasing level of centralization within the network. Ryan Watkins, a Messari analyst recently addressed the influence that Binance has on the entire Binance Smart Chain, explaining that most of the commendable progress made on the network is not the result of the implementation of innovative concepts. Rather, it is a product of Binance’s control over the BSC network.

“The reason why BSC is faster and more scalable is not because of some magical technological innovation. No, it’s instead the magic of centralization. BSC is an Ethereum fork with a centralized validator set. That’s it. Nothing more.” He wrote on Twitter.

Unlike some other networks, the Binance Smart Chain has a total of 21 validators (people who verify the transactions and confirm their legitimacy, before adding them to the Blockchain). These validators are handpicked by the Binance Chain, further strengthening the notion that the network may be more centralized than it shows itself to be. 

Wilson Withiam rolls out some points to consider, starting with the pattern of resetting active validators, which is determined by the voting power of each validator. He notes that BNB staking and delegation is carried out on the Binance Chain, by Binance Chain validators as well.

In essence, Withiam argues that the pattern of validator distribution across the Binance Smart Chain is questionable as the identities of those behind the nodes in the validator sets are not made transparent. As he puts it “BSC now supports several third-party validators, although at least 5-6 others have close ties to Binance. The distribution of validator accounts is far less clear for Binance Chain.”

To dispute that Binance’s user experience is not ahead of other networks is false, and Withiam agrees with this. Even Watkins acknowledges this as he noted that BSC has fueled mainstream adoption of DeFi “Binance has incredible reach and influence and has used that to funnel a boatload of new users in DeFi. Binance executes period. That’s why BSC is winning.” He asserted. 

However, he argues that speed and scalability outside Ethereum without sharding or a centralization can only be legitimately found on the Solana Blockchain. Conclusively, Withiam urges BSC users to poke into the network, enough to understand where the loopholes are. 

“For those using BSC, take the time to understand the topology of the network. Sure, the fees and speed (both UX factors) are undoubtedly preferable. But strong censorship resistance and fault tolerance are not part of the package.” He wrote in conclusion.

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Ethereum’s Blockchain will be home to Visa’s settlement transaction

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Ethereum's Blockchain will be home to Visa's settlement transaction

Visa has made a decision to allow the use of the stablecoin USD Coin in the settlement of transactions on its network over the Ethereum blockchain.

As announced on Monday, global payments technology company Visa Inc. mentioned transactions on its network could now be settled via Cryptocurrency with the use of the stablecoin USD Coin. 

According to a Reuters report, Visa noted the program was piloted with the payment platform Crypto.com, further stating that plans are underway to extend it to other crypto partners.

The USDC, or USD Coin, is a stablecoin crypto with a 1:1 fixed ratio to the US Dollar in value.

This marks a turning point in the settlement of transactions on the Visa payment network especially for partners with cryptocurrency holdings. The traditional process required customers with cryptocurrency holdings to convert the asset to fiat currency at an additional conversation rate before payments could be made on the network.

On the other hand, with this recent development, customers could easily settle transactions directly with the use of USDC by paying to Visa over the Ethereum blockchain, eliminating the hassles and extra fees that come with conversions.

Head of Crypto at Visa, Cuy Sheffield noted that this move comes as a result of increasing demand for cryptocurrencies from “consumers across the world”.

Recall that Visa had been one of the major adversaries of Bitcoin and digital assets, attracting general criticisms for its otherwise “backward” stance on growing technology.

Now, with the recent decision to allow transactions directly with USDC, it has completely embraced the emerging concept of cryptocurrency—a move that could potentially open doors for seamless transactions on its network, attracting more cryptocurrency proponents.

It wasn’t until early this year that the Credit/debit card company made a complete turnaround in its position with the unveiling of its crypto payment service for banks last month after a period of seemingly ceaseless antagonism against digital assets.

Visa’s recent decision to accept settlements in USDC is the latest indication of increasing adoption of crypto in the FinTech industry with major big players like BlackRock Inc, BNY Mellon, and MasterCard Inc embracing and adopting virtual assets.

Meanwhile, the payment giant PayPal had been indicating interest in crypto right from the jump, stepping into the Crypto space officially sometime last year as they finally allowed users to hold cryptocurrencies on the platform.

MasterCard Inc. recently announced its plans to support digital assets, outlining strict criteria for adoption. Inasmuch as indications suggest not all cryptocurrencies would be adopted, these recent decisions by major financial firms suggest growing acceptance of digital assets—a revolutionary concept that can potentially affect the financial industry as well as conventional business transactions in a huge way.

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