The central bank released a signal, BAT started to lay out, and Bitcoin rose 10% in one day

Yesterday, the People's Bank of China held a seminar on digital currency. Digital currency research experts from the People's Bank of China, Citibank and Deloitte discussed and exchanged views on topics such as the overall framework for digital currency issuance, national digital currency in the evolution of currency, and nationally issued cryptocurrency. Zhou Xiaochuan, governor of the People's Bank of China, attended the meeting, and Fan Yifei, deputy governor of the People's Bank of China, presided over the meeting. Experts from relevant domestic and foreign research institutions, important financial institutions and consulting institutions attended the meeting.

The central bank has established a special research team since 2014, and in 2015, it conducted in-depth research on the digital currency issuance and business operation framework, key technologies of digital currency, the digital currency issuance and circulation environment, legal issues faced by digital currency, the impact of digital currency on the economic and financial system, the relationship between legal digital currency and privately issued digital currency, and international experience in digital currency issuance.

As soon as the news was released, Bitcoin rose. At 19:52 yesterday, the price of Bitcoin was 2539, and it rose to 2810 within a day, an increase of nearly 10%.

The fate of the central bank and Bitcoin

This is not the first time that the central bank has spoken out against digital currency. As early as December 3, 2013, the People's Bank of China, the Ministry of Industry and Information Technology, the China Banking Regulatory Commission, the China Securities Regulatory Commission, and the China Insurance Regulatory Commission issued Document No. 289, "Notice on Preventing Bitcoin Risks," which prohibited Chinese banks and payment systems from conducting Bitcoin business, and that Bitcoin had no legal currency status. Private transactions of Bitcoin were allowed, but at their own risk. Bitcoin fell in response.

In mid-March 2014, the central bank issued a notice titled "Notice on Further Strengthening Bitcoin Risk Prevention" to all its branches. This notice continued Document No. 289 but was more stringent than it. The document required all banks and third-party payment institutions to close all trading accounts of more than a dozen domestic Bitcoin platforms. This means that it is illegal for financial institutions to open trading accounts for Bitcoin website platforms. Unless it is a cash transaction, Bitcoin investors cannot make bank transfers or third-party payments for transactions in China. This is unprecedented.

The price of Bitcoin has been significantly affected by the attitude of the People's Bank of China. On November 19, 2013, it once reached 8,000 yuan, but the transaction price was soon cut in half. As of February 26, 2014, it fell to 3,331 yuan, and on March 5, 2014, it fell to 4,068 yuan. In mid-March, the price fell again after the central bank issued a notice. As of March 27, the price of each Bitcoin in China was 3,561 yuan.

After two years, the central bank announced the early launch of digital currency. This is the second time the central bank has made a clear statement on digital currency since the five-department document was issued in 2013. It is unknown how long this impact on the price of Bitcoin will last.

Not only the central bank, BAT officially involved in digital currency

The rise in Bitcoin prices this time may also be related to yesterday’s news that Alibaba is planning to enter the blockchain field. In fact, the BAT giants have already tried to get involved in the field of digital currency and blockchain.

On October 15, 2013, Baidu's Baidu Accelerator service announced support for Bitcoin. Baidu Accelerator is a website security acceleration platform that provides website security protection services to more than 190,000 webmasters. On the same day, the following paragraph appeared at the top of the package page of Baidu Accelerator's official website: "Baidu Accelerator already supports Bitcoin payment. If you need to use Bitcoin payment, please contact 4000600990." This can be said to be the first service in China to accept Bitcoin payment. After the release of the document by the five ministries of the central bank, Baidu immediately announced on December 6, 2013: "In response to the spirit of the country's control of Bitcoin risks," Baidu Accelerator stopped accepting Bitcoin payments.

In the second half of this year, at the Global Entrepreneurship Week and the 5th China (Shanghai) Angel and Early Investment Summit, Xiong Minghua, former CTO of Tencent, proposed that industries such as Bitcoin should be deployed in advance in the next five years. He sorted out the 145 unicorn companies in the world and found that these companies are roughly distributed in six fields, and four of them need to be focused on in the future, one of which is Bitcoin. Xiong Minghua revealed that he was recently invited to invest in a Bitcoin company in Silicon Valley. This company has mastered more than 50 technologies out of more than 80 technical difficulties in the Bitcoin field. LinkedIn CEO Hoffman himself invested 20 million US dollars. Seven Seas Capital has increased five times in three months since investing in this project.

The latest news shows that Ali Finance will also launch a cloud service platform based on blockchain technology. At the 2016 Yunqi Conference Shanghai Summit yesterday, members of Ali Finance Division revealed that they are currently working with Ethereum to build a public financial cloud based on blockchain, which does not require any servers to run on it, making it convenient for smart contracts and other programs to run on it. There are many beautiful imaginations in the application scenarios of blockchain, and perhaps mutual insurance and crowdfunding industries are most likely to use blockchain technology to produce practical applications.

At this point, the BAT giants can be said to have officially entered the field of digital currency.

Is it really beneficial to existing digital currencies?

As soon as the news of Alibaba Cloud Finance and the Central Bank’s digital currency seminar came out yesterday, Bitcoin rose. There was no shortage of related discussions in the community. Data provided by Pan Guoli of Bifu.com showed that “there were more one-sided transfers, and the number of newcomers also increased significantly.”

But some netizens pointed out that

The concept discussed by the central bank this time is the electronicization of paper money. Whether digital currency can replace the issuance of paper money and whether to allow the private sector to issue digital currency are two different things. The only connection between the electronicization of paper money and the existing digital currency is the use of blockchain technology. Therefore, this seminar is not very good for Bitcoin itself.

Reporter: Meng Dada
Source: Babbitt Information