A lot has been made in recent time about China’s social credit system, and how dystopian such a concept seems. In essence, by 2020 China’s government wishes to have a rank on all citizens that will act as a reward system to incentive ‘good’ behavior and punish ‘bad’ behavior. There have already been consequences given due to the system, including blocking around nine million people from buying flight tickets. However, China is now trying to take this one step further through the use of Cryptocurrency.
At the moment, many Chinese citizens in big cities use mobile payment systems such as WeChat and Alipay in lieu of cash or physical cards. These mobile payment systems can be used to pay for anything from food to bills with convenience. However, there is a scare that these apps may be able to gather information on what the person is buying. While this may scare some people, what upsets the Chinese government isn’t that they can get information, but rather that the information is controlled by private corporations rather than them. But fear not, for they may have just found a solution to their problem: Cryptocurrency.
Cryptocurrencies have been restricted for years in China, but the announcements by Facebook of their intention of creating a cryptocurrency called Libra seems to have propelled China into accelerating their own efforts. The advantages of having their own cryptocurrency is that they will be able to collect huge amounts of data on their citizens, but also that the currency may be easier to be accepted in other countries. China has tried in the past to get the renminbi to become a strong, world currency without much luck but clearly harbor hopes that a cryptocurrency may be more easily accepted in developing countries where they already have large investments, such as Western Africa.
Personally, I believe that a country creating a cryptocurrency is a bit alarming, but may be the logical next step in world politics. I could see the US taking the same route in the next 50 years, because what is a loss of privacy in comparison to slight convenience. However, just as alarming to me would be letting Facebook or other large corporations get the same amount of information themselves through private cryptocurrencies. There isn’t much of a solution in this situation other than just destroying all currency and returning to a bartering system.
Article: https://www.nytimes.com/2019/10/18/technology/china-cryptocurrency-facebook-libra.html