* BLOCKCHAIN * - and Digital Currency

[Randy W]

An ongoing topic - click here for Most Recent Post

 

 

BLOCKCHAIN - because, well . . ., why not ?

from Abacus News


chinese media warns about blockchain

Chinese media calls for investors to avoid speculating on blockchain companies

China's President Xi Jinping said the country would invest more in blockchain technology, causing stocks to surge

China’s state media said investors should avoid speculative behavior after comments by President Xi Jinping sent blockchain-related stocks surging on Monday.

“The future is here for blockchain, but we need to stay rational,” the People’s Daily said in a commentary.

. . .

“The message is clear -- companies should focus on their main business and not jump on the blockchain bandwagon,” said Sun Jianbo, president of China Vision Capital Management. “It’s a warning that support for the sector does not equal an endorsement of speculative trading.”

ALSO READ

Here's why China's digital currency won't run on blockchain

The PBOC has considered it, but researchers have expressed doubts about whether the technology would be able to support a large volume of simultaneous transactions. China’s annual Singles’ Day shopping gala in 2018 had payment demand peaking at 92,771 transactions per second, far above what Bitcoin’s blockchain could support, according to another central bank official, Mu Changchun.

 

 

[Randy W]

from the SCMP. It's hard to imagine that * BLOCKCHAIN * will offer them any advantage in whatever it is that they want to do with it.

 

Will the China of tomorrow run on the technology behind bitcoin?

• President Xi Jinping told the Communist Party elite in October he wanted the country to be a ‘rule maker’ on blockchain technology and ever since state media has been bombarding the public with articles on the subject
• One expert said it ‘could open a new chapter on the integration of governance and technology, if proved a reliable technology’

 

 

Speaking at a study session for members of the Politburo last month, Xi said blockchain would play “an important role in the next round of technological innovation and industrial transformation”, suggesting it will be central to the country’s race against the United States for technological supremacy.

According to a report by Xinhua, Xi called for China to become a world leader and “rule maker” in the field, saying blockchain had applications in the financial, manufacturing and public sectors.

While he did not mention state governance as a possible application, the Communist Party and governments at all levels are likely to see Xi’s comments as a call to action.

People’s Daily, the party’s mouthpiece, ran an editorial on its website days after Xi’s speech, saying “officials and party cadres must understand that the top leadership attaches high importance to blockchain technology due to the prospects of its application in the real economy, people’s livelihood and the state governance”.

I worry that people have oversold blockchain to Xi as a magic cure-all

James Andrew Lewis, Centre for Strategic and International Studies

China’s 13th five-year plan for 2016-20 stresses the role of artificial intelligence and blockchain in the development of the country’s strategic technological advantage.

Although Beijing has cracked down on the mining and trading of cryptocurrencies, it has never outlawed blockchain as a technology. Rather, local governments have set up industrial estates to attract blockchain start-ups, in response to the call to support innovation.

 

[Allon]

It's actually a disadvantage if people do not embrace Bitcoin (although block chain can work without it) and it cuts out the middle man in the process -- Amazon, Uder, and other (Ali Baba) online retail merchants. Middle men will be eliminated in the process.

[Randy W]

It's actually a disadvantage if people do not embrace Bitcoin (although block chain can work without it) and it cuts out the middle man in the process -- Amazon, Uder, and other (Ali Baba) online retail merchants. Middle men will be eliminated in the process.

 

 

Are you talking about crypto-currency here? Blockchain allows a permanent, non-centralized record of all transactions, but it's hard to see that that is advantageous for most commercial applications which use a centralized database or source. For example, Facebook could use a blockchain method of tracking posts, instead of their present database and backups (which must be huge), but what would be the advantage?

 

 

I just had to google it - https://techcrunch.com/2012/08/22/how-big-is-facebooks-data-2-5-billion-pieces-of-content-and-500-terabytes-ingested-every-day/

 

its system processes 2.5 billion pieces of content and 500+ terabytes of data each day. It’s pulling in 2.7 billion Like actions and 300 million photos per day, and it scans roughly 105 terabytes of data each half hour.

 

[Allon]

No doubt it is going to help some large transaction based business. (I guess we call them "tokens" in the biz before, even tho I hate using that term. It means way too many things and in this case, not really a good fit for what block chain means.)

 

But when the trans are bundled and shoved through in a block that avoids the middle man fees, some will get hurt. And bitcoin is just mode of currency. Digital certificates can also be a form of currency -- as long as they can be verified as well as bitcoins are.

 

 

https://blockgeeks.com/guides/what-is-blockchain-technology/

 

Think of a railway company. We buy tickets on an app or the web. The credit card company takes a cut for processing the transaction. With blockchain, not only can the railway operator save on credit card processing fees, it can move the entire ticketing process to the blockchain. The two parties in the transaction are the railway company and the passenger. The ticket is a block, which will be added to a ticket blockchain. Just as a monetary transaction on the blockchain is a unique, independently verifiable and unfalsifiable record (like Bitcoin), so can your ticket be. Incidentally, the final ticket blockchain is also a record of all transactions for, say, a certain train route, or even the entire train network, comprising every ticket ever sold, every journey ever taken.

But the key here is this: it’s free. Not only can the blockchain transfer and store money, but it can also replace all processes and business models that rely on charging a small fee for a transaction. Or any other transaction between two parties.

Here is another example. The gig economy hub Fivver charges 0.5 dollars on a 5 transaction between individuals buying and selling services. Using blockchain technology the transaction is free. Ergo, Fivver will cease to exist. So will auction houses and any other business entity based on the market-maker principle.

Even recent entrants like Uber and Airbnb are threatened by blockchain technology. All you need to do is encode the transactional information for a car ride or an overnight stay, and again you have a perfectly safe way that disrupts the business model of the companies which have just begun to challenge the traditional economy. We are not just cutting out the fee-processing middle man, we are also eliminating the need for the match-making platform.

---

Blockchain may make selling recorded music profitable again for artists by cutting out music companies and distributors like Apple or Spotify. The music you buy could even be encoded in the blockchain itself, making it a cloud archive for any song purchased. Because the amounts charged can be so small, subscription and streaming services will become irrelevant.

It goes further. Ebooks could be fitted with blockchain code. Instead of Amazon taking a cut, and the credit card company earning money on the sale, the books would circulate in encoded form and a successful blockchain transaction would transfer money to the author and unlock the book. Transfer ALL the money to the author, not just meager royalties. You could do this on a book review website like Goodreads, or on your own website. The marketplace Amazon is then unnecessary

 

[Randy W]

BUT . . . (from the top post above)

 

 

 

 

Here's why China's digital currency won't run on blockchain

Quote

The PBOC has considered it, but researchers have expressed doubts about whether the technology would be able to support a large volume of simultaneous transactions. China’s annual Singles’ Day shopping gala in 2018 had payment demand peaking at 92,771 transactions per second, far above what Bitcoin’s blockchain could support, according to another central bank official, Mu Changchun.

 

Why would Xi Jinping promote blockchain? The answer may lie in the quote above - "I worry that people have oversold blockchain to Xi as a magic cure-all"

China already employs free electronic transactions without blockchain.

Bitcoin hasn't made the inroads that were expected/hyped for it. It HAS survived as an investment reliant on the "free" computing power that people put into it.

Somehow, I can't see China going along with this:

The reason why the blockchain has gained so much admiration is that:

• It is not owned by a single entity, hence it is decentralized

 

 

Can we just disagree on this? Don't forget - China banned bitcoin.

Edited December 3, 2019 by Randy W (see edit history)

[Randy W]

from Abacus

 

Can China, the birthplace of Alipay and WeChat Pay, win the digital currency race?

 

Experts say Asia's central banks, led by China, could become some of the world's first to roll out digital version of their national currencies, rivalling private cryptocurrencies

 

 

China’s ‘digital yuan’ will be intended solely for the payment of goods and services. (Picture: Shutterstock)

One thing these central banks have in common is that they are all planning to partner with commercial banks in rolling out their digital tokens. But China will for now limit their use to domestic retail payments, unlike Hong Kong and Thailand, which are exploring their use for cross-border payments in bilateral trade.

Given its retail focus, China’s central bank, the People’s Bank of China, is keen to differentiate its digital currency from cryptocurrencies

 

. . .

 

Mu Changchun, deputy director of the PBOC’s payment and settlement department, said its “digital currency electronic payment” project involves digital yuan intended solely for the payment of goods and services. It should not be confused with cryptocurrencies, the trading of which authorities have clamped down on.

“It is different to bitcoin or stable tokens, which can be used for speculation or require the support of a basket of currencies,” Mu was quoted by the Shanghai Securities News earlier this month as saying.

The PBOC’s ultimate goal is to replace cash – notes and coins changing hands anonymously – with its digital yuan.

 

 

[Allon]

BUT . . . (from the top post above)

 

 

 

 

Here's why China's digital currency won't run on blockchain

 

 

Quote

The PBOC has considered it, but researchers have expressed doubts about whether the technology would be able to support a large volume of simultaneous transactions. China’s annual Singles’ Day shopping gala in 2018 had payment demand peaking at 92,771 transactions per second, far above what Bitcoin’s blockchain could support, according to another central bank official, Mu Changchun.

 

Why would Xi Jinping promote blockchain? The answer may lie in the quote above - "I worry that people have oversold blockchain to Xi as a magic cure-all"

China already employs free electronic transactions without blockchain.

Bitcoin hasn't made the inroads that were expected/hyped for it. It HAS survived as an investment reliant on the "free" computing power that people put into it.

Somehow, I can't see China going along with this:

The reason why the blockchain has gained so much admiration is that:

• It is not owned by a single entity, hence it is decentralized

 

 

Can we just disagree on this? Don't forget - China banned bitcoin.

 

Not sure we are disagreeing on anything. It's a discussion.

 

There are really two subjects with lower levels of each. There is the subject of blockchain technology only, regardless of Bitcoin or certificates, and blockchain with Bitcoin and certificates. Either way, blockchain is being used. I don't think I said I disagreed with the notion that China is right in that blockchain will not handle "bulk" or large transactions of similar nature, as Bitcoins would likely be. We have already seen decentralization handle large volume and very poorly. Load balancers just add to a performance issue. Centralized systems, like mainframes, handle it a little better but still have to have EDI/MQ technology to handle recovery in case of problems. And it does not work well when the data has no integrity -- unlike blockchain is supposed to have. (I am leary of the of the term "similar transaction type or nature.")

 

I don't think it is a perfect science yet (what is?) and completely explains to me China's reticence to get it to 5th gear. And Bitcoin anyway to me is a pipe dream. It is already shows signs of volatility.

[Randy W]

I can't see that a digital version of a national currency would involve any accounting, shipping, receiving, billing, or inventory changes by any commercial enterprise, but I can wait and see.

 

The only thing I can visualize is a substitute for AliPay and WeChat electronic payments. Which I'm comfortable with, since they are from accounts separate from my bank account.

Speaking of which, ACH (Automated Clearing House) electronic payments have been a thing for a long time, including for some companies which convert paper checks to electronic withdrawals.

 

I guess I'll have to see what a digital national currency actually is.

[Randy W]

rolling it along - from Abacus

"looks llike Alipay and WeChatPay"

China starts testing digital currency as Facebook's Libra faces setback
Facebook scaled back ambitions for its own digital currency, but China is moving ahead with a digital yuan app

The following day the National Business Daily reported that the Xiangcheng district of Suzhou was expected to put the currency to use in May by paying half the travel subsidies given to public sector workers in digital form.

The 21st Century Business Herald also reported that one unnamed state bank, which is testing the official digital currency, has allowed some of its Communist Party members to pay their membership fees.

The Digital Currency Research Institute of the People’s Bank of China, the agency that is in charge of digital currency development and testing, confirmed that it is conducting trial programs via China’s state-owned banks.

. . .

It said pilot schemes for the digital currency would be held in four cities – Shenzhen, Suzhou, Xiongan and Chengdu. It also said 2022 Winter Olympic venues could also be used to test the currency.

But it added that these test versions and applications were not final and “it doesn’t mean that China’s sovereign digital currency is officially launched.”

For now, the tests and trials will be conducted in “closed environments” and will not have any impact on related institutions.

The brokerage house added that the total size of China’s digital currency could reach 1 trillion yuan (US$140 billion) over the coming years, equivalent to digitalizing about one eighth of China’s cash. In comparison, the total market capitalization of cryptocurrencies, including bitcoin, is about US$200 billion.

. . .

Facebook’s Libra project was once touted as a new currency for the internet era but these hopes have faded in the face of strong scrutiny from regulators.

 

China's digital currency app looks like Alipay and WeChat Pay

 

A screenshot of the app circulating online likely isn't the final version of the digital currency, which is expected to be tightly controlled instead of decentralized like bitcoin

[Randy W]

from Abacus

 

Using China’s digital currency could be just like using Apple Pay

 

In addition to QR codes, the digital yuan app might also use NFC, allowing people to pay with a tap of their phone

 

Using China’s digital currency could be just like using Apple Pay - In addition to QR codes, the digital yuan app might also use NFC, allowing people to pay with a tap of their phone | Abacus

 

Dong Ximiao, a research fellow at the National Institution for Finance and Development, explained in an interview with CCTV on Monday how China’s long-awaited sovereign digital currency will work. Transactions could be made through NFC on smartphones, the same technology used by Apple, Google, Samsung and others to allow people to pay by waving their phones at a special terminal.

 

“The digital currency can be conveniently used without the internet,” Dong said. “Users can make transactions or payments by bringing two mobile phones with electronic wallets close to each other.”

 

Dong’s explanation sounds similar to how many digital wallets work these days. Users can exchange money in their bank accounts for the digital currency, which is then deposited in an electronic wallet, Dong said.

 

[Randy W]

A test run

from the Sixth Tone on Facebook - Dec. 11
https://www.facebook.com/1570821646570023/posts/2829349807383861/?substory_index=0

Residents in Suzhou received 20 million yuan ($3 million) divided across 100,000 virtual red packets, each containing 200 yuan, via a lottery launched by the government as part of a trial of China’s digital currency, according to an official announcement Friday. (Image: Liu Yichen)

 

[Randy W]

 

Analysis: China digital currency trials show threat to Alipay, WeChat duopoly

This link seems to work only on my phone, depending on whether it converts the url to www.investing.com, cn. . . ., or m. . . ., and depending on whether that url works.

Quote

Shanghai - In China's commercial hub Shanghai, six big state banks are quietly promoting digital yuan ahead of a May 5 shopping festival, carrying out a political mandate to provide consumers with a payment alternative to Alipay and WeChat Pay.
The banks are persuading merchant and retail clients to download digital wallets so that transactions during the pilot programme can be made directly in digital yuan, bypassing the ubiquitous payment plumbing laid by tech giants Ant Group, an affiliate of Alibaba (NYSE:BABA) 9988.HK, and Tencent 0700.HK.
"People will realise that digital yuan payment is so convenient that I don't have to rely on Alipay or WeChat Pay anymore," said a bank official involved in the rollout of e-CNY for the Shanghai trial, under the guidance of China's central bank. The official is not authorised to speak with media and declined to be identified.

 

 

Edited April 28, 2021 by Randy W (see edit history)

[Randy W]

A visitor scans the code of digital RMB during the 2021 China International Fair for Trade in Services (CIFTIS) in Beijing, capital of China, Sept. 4, 2021.
The Financial Services thematic exhibition, currently underway until Sept 7 at the Beijing Shougang Industrial Park during the 2021 China International Fair for Trade in Services, highlights digital finance and services this year.
A digital finance demonstration zone, as well as digital RMB Avenue is set at the exhibition hall to enable visitors get a close look at different usage scenarios of digital currencies.
Photograph by Chen Jian/China Pictorial   #CIFTIS2021  #digitalRMB  #eCNY

from China Pictorial on Facebook 
https://www.facebook.com/ChinaPic/posts/4104535873005104

 

[Randy W]

China’s digital fiat currency, or the #e-CNY, is being used at restaurants, booths, and vending machines for the first time at the ongoing Fourth China International Import Expo (#CIIE).
The Bank of China has set up six booths at the venue of CIIE to help those in need to apply for a digital yuan wallet, and around 60 to 80 people stayed at each booth ready for help every day, said Chu Yifeng, an employee of the bank.
E-CNY is the digital version of fiat currency issued by the People’s Bank of China (PBOC) and operated by authorized operators. It is a value-based, quasi-account-based and account-based hybrid payment instrument, with legal tender status and loosely-coupled account linkage.

from China Pictorial on Facebook 
https://www.facebook.com/ChinaPic/posts/4302370993221590