Empires never want men and women to serve two masters: yes, no binary. For e-Yuan to rise, Bitcoin, Ether, etc must fade. And in Nigeria, for e-Naira to hold its space, BTC and cousins must be off-network. China will not kill Bitcoin but if China disconnects it as it executes a global playbook to insert e-Yuan into the commerce ordinance, fighting the US dollars, Bitcoin will struggle.
The People’s Bank of China (PBoC) has on Friday declared all cryptocurrency-related transactions illegal. The central bank said every crypto activity in the country must be banned as they pose a threat to national security and the “safety of people’s assets.”
China started an onslaught against cryptocurrencies earlier in the year, fuelling a massive crash of the market as it clamped down on miners. The latest of the series of China’s crackdown on cryptocurrency is likely the final, as the Asian country is at the verge of launching its Central Bank Digital Currency (CBDC) E-yuan.
Bitcoin is quickly losing what made it amazing to many: decentralization. Yes, even though it is decentralized technically, it has been centralized at the exchange. How? The Biden Administration now does not pursue BTC wallet owners – they simply sue the exchange, and make a case that exchanges are expected to know their customers (KYC) and adhere to anti-money laundering (AML) protocols because for exchanges to have received their operating licenses (they need them to be connected to banks), they promised to do so.
I wrote here last year that China will be opening banks in many countries to help them push e-Yuan. A Chinese bank is coming to Nigeria soon, according to the ambassador. Bitcoin is a distraction for China: there is the US dollar to battle. Who wins will take the mantle as the economic superpower of the 21st century.
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China’s central bank has deemed cryptocurrencies, including bitcoin and ether, to be illegal. The People’s Bank of China said via an online statement the move was to “maintain national security and social stability,” per The Wall Street Journal, and it comes as the country tests its own digital currency. China has been trying to regulate cryptocurrency for years — it banned bitcoin back in 2013 — and just this past May it announced a crackdown on crypto-trading. What does this mean for the U.S.? One blockchain expert says “it could impact market volatility for investors.” (LinkedIn)
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Comment: The play book is to make e-Yuan and e-Naira a weapon that will jointly reduce fx issue by US dollars. BTC will not be an issue because it doesn’t symbolize any country currency.
We expect naira to gain value in the long run due to the benefit to be derived from e-Naira on the strength of its cross border trade.
My Response: If e-Naira becomes a node within e-Yuan making it possible for Nigerian importers to pay for things in China, few will need USD. At least, 70% of USD people fight for are used to import things from China when you exclude education and healthcare from Nigeria. Yes, I will not buy any thesis that is built on the efficiency of transactions to move pricing equilibrium without a shift in the balance of trade. So, e-Naira will not fix the FX issue if Nigeria does not produce things. Simply, any gain will be ephemeral.
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“Yes, I will not buy any thesis that is built on the efficiency of transactions to move pricing equilibrium without a shift in the balance of trade. So, e-Naira will not fix the FX issue if Nigeria does not produce things. Simply, any gain will be ephemeral.”
Absolutely