Apple Pay + digital currency, will paper money say goodbye to us?

Apple Pay was launched on February 18th, which not only set off a fire in WeChat Moments, but also became the focus of public opinion. Almost everyone was discussing whether Alipay and WeChat were trembling, or what the prospects of Apple Pay were in China. This seemed to be the most concerned topic in the industry. However, this was not the topic that had the greatest impact on our lives.

Apple Pay’s entry into China is not just an isolated incident. It is like a game of chess, and Apple Pay is just a piece. It is actually somewhat limited to only consider the quality of this move. If it can be linked to other pieces, we will see a different layout. In other words, if Apple Pay is linked to other areas of Internet finance, we will see a different situation. Among them, the most relevant area is undoubtedly digital currency.

Not too far from the time of Apple Pay, at the end of January this year, the relevant person in charge of the People's Bank of China said that the future prospects of mobile payment are bright, and the central bank is actively studying relevant research results and practical experience at home and abroad, striving to issue digital currency as soon as possible. In addition, it is revealed that the central bank has established a special research team since 2014 to conduct in-depth research on the issuance and business operation framework of digital currency, key technologies, circulation environment, etc., and has achieved phased results. This means that digital currency is not far away from us.

These two seemingly isolated events are related. They are both making one thing lose its meaning: paper money. In other words, with the trend brought by Apple Pay and the development of digital currency technology, paper money is gradually losing its value.

Apple Pay kills the wallet

Apple Pay does have a lot of limitations, such as being limited to certain Apple devices, limited application scenarios, and the high offline costs of NFC technology. However, it is undeniable that Apple Pay has attracted a lot of attention, driven by Apple's brand power.

It actually plays a role of connecting the past and the future. First of all, although the number of people using Apple devices is indeed not as large as that of Android users, these people tend to have a certain consumption awareness or consumption ability, and this group of people is also a group that has a great driving force on public opinion. Therefore, the formation of habits among these people will have a great driving effect on mobile payment.

Secondly, Apple is the leader in smartphones, and it is easy for peers to imitate it. Moreover, Android users cannot just sit there and watch Apple users enjoy fast payment services. Therefore, although only Apple supports NFC at present, many Android manufacturers will definitely follow suit in the future. This is caused by market demand. For example, less than 12 hours after Apple entered China, Samsung could not sit still and started pushing updates to the Note 5/Galaxy S6 edge+ devices sold in China. Samsung is just one of them, and many manufacturers will inevitably take action in the future, thus triggering a trend.

Third, Alipay and WeChat in the mobile payment field obviously cannot sit idly by. They can ignore Lakala, but they cannot ignore Apple Pay. Therefore, Apple Pay will also arouse the enthusiasm of third-party payment platforms and promote them to speed up their layout.

Therefore, it is expected that the introduction of Apple Pay in China will accelerate the popularization of mobile payments. In fact, driven by WeChat and Alipay, the habit of mobile payments is gradually becoming popular. In second- and third-tier cities, supermarkets, restaurants and many other scenarios already support mobile payments.

Digital currency: the general equivalent after paper money

With the widespread popularity of mobile payments, paper money is undoubtedly the most vulnerable. Paper money serves as a general equivalent after precious metals, but it has no value in itself. Therefore, paper money cannot maintain its value, but it is not irreplaceable.

In addition, the disadvantages of paper money are obvious. Its issuance and circulation will incur huge costs. Moreover, it is difficult to prevent counterfeiting and is prone to illegal activities such as money laundering and tax evasion. The issuance of paper money is equal to the total price of goods divided by the average circulation number of the same unit of currency. If offline payment can basically replace paper money, the frequency of offline circulation will be greatly reduced, and the demand for paper money will also be greatly reduced.

When almost all transactions take place online, the time is ripe for digital currency to serve as the new general equivalent. Judging from the current rumors, the technology of digital currency is becoming increasingly mature, and perhaps in the future we will gradually enter an era of transition from paper currency to digital currency.

Of course, it will take some time for digital currency to completely eliminate paper money, and digital currency still needs to overcome potential risks, such as the crazy Bitcoin in the past few years. In addition, it is almost impossible to get this generation to abandon paper money. But in the future, mobile payments will gradually make the paper money in our wallets less and less useful, and digital currency will replace paper money and enter the stage of history. This sounds a bit like science fiction, but it is indeed moving in this direction.