- Wu Xiaoling, former deputy governor of the People’s Bank of China, has called Bitcoin a commercial success, but said it has a central flaw.
- Xiaoling predicts that there will be a broader adoption of digital currencies in the future, but does not believe that Bitcoin (BTC) can replace Fiat money.
In an interview with the local newspaper Sina, the former vice-governor of the People’s Bank of China, Wu Xiaoling, acclaimed Bitcoin (BTC) as a technological breakthrough. Xiaoling’s statements are unusual; representatives of the People’s Bank of China have been critical of Bitcoin in the past. Especially after the announcement of the announcement of the digital currency issued by the Central Bank (CBDC) of China, the Digital Yuan.
The fatal flaw of Bitcoin (BTC)
Xiaoling said Bitcoin (BTC) is the most commercially successful product of the blockchain technology. However, Xiaoling also highlighted its limitations and said that she believes Bitcoin is limited to being a private coin. In addition, she noted that Bitcoin’s price high volatility of BTC’s will prevent it from replacing fiat money.
Xiaoling believes that the authorities of sovereign countries will not recognize Bitcoin as an official currency. The former governor of the People’s Bank of China believes that Bitcoin will most likely remain as a digital asset. In that sense, Xiaoling also said that digital currencies and digital assets will get a greater adoption and will be integrated into social behavior. But for that to happen, there has to be financial service that support Bitcoin and other digital currencies, according to Xiaoling.
Finally, the former governor of the People’s Bank of China stressed that there is a legal framework that Bitcoin has to follow. Innovation, in Xiaoling’s opinion, does not have to be a disruptive element that “disturbs the law”, the former governor added:
In the future, the digital currency will increasingly be integrated into social behavior, and we must have a prudent and objective understanding of it.
As CNF has reported, last year it was thought that China would open up to the use of cryptocurrencies. However, the Asian giant was only paving the way it would take to announce the development of its digital Yuan. The digital yuan is currently in its testnet phase in four cities: Chengdu, Suzhou, Shenzhen, Xiong’An. The goal is to test the digital Yuan as an electronic payment method. Recent reports have also speculated that the digital Yuan may be tested by McDonald’s, Starbucks, Subway and other restaurants in the provinces referred to. The digital Yuan may also be tested during the 2020 Olympics in Beijing. Otherwise, few details are known about the CBDC.