财政危机 · 10

What crosses bulls and bears is not consensus, but structure: Looking at Web3 from the perspective of Centennial Soccer Clubs

Author: Zen, PanNews Original title: Secrets of Crossing the Cycle: How Centennial Soccer Clubs Live for Web3 If you look at European Centennial Soccer Clubs as a long-term sample of “community products,” what is really shocking is not the number of trophies, but rather that they allow people of different generations, classes, and even nationalities to continue to be willing to invest time, money, and emotions to protect the same community over a period of 100 years. This hits the heart of Web3 startups: the industry is good at discussing growth, incentives, tokens, and governance, yet often lacks a sense of belonging and trust that can go through the cycle. The popularity came and dissipated quickly; many projects, like meteors crossing the night sky, came and went in a hurry and fell silent in a blink of an eye; most DAO experiments began in an idealistic utopia, but ended in an egoistic conflict of interest. And if you go back in time to the era when soccer clubs were born, you'll find another simpler, more long-term logic: clubs were initially created not to serve the business will of a certain boss, but to represent the community and fans. This coincides with the “community-driven” that the Web3 industry has repeatedly emphasized. Because of this, returning to the starting point of those century-old clubs may provide a more reliable frame of reference for Web3 community building. Identity and cultural affiliation In 1878, cheers sounded at a workers' tavern on the outskirts of Manchester, England. Several railway locomotive factory workers, who often gather here after work, were excited to talk about the idea of officially forming a soccer team. Afterwards, this group of railroad workers formed a team at Newton Heath. The team uniform used the railway company's iconic green and gold color scheme, and even the dressing room was rented at a nearby pub. Just like that, a team founded by ordinary workers was quietly born — the predecessor of the Premier League's top giants Manchester United. This kind of story is no exception to Manchester United. In mainland Europe, many century-old clubs are rooted in working-class communities and local cultural soil, and soccer has been deeply rooted in grassroots communities in industrial cities since its inception. In 1899 in Spain, Hans Gamper (Hans Gamper), a young Swiss man looking for someone to play in a foreign country, placed an advertisement in a local sports magazine to find friends interested in forming a soccer team. And this announcement also became the “moment when the Barcelona club actually started”: a small international group of Swiss, Catalans, English, and German people gathered at the Soleil Stadium and founded Barcelona Club. Gamper's goal is to create an organization that is open to everyone, regardless of origin. The club he envisions can promote social integration and create a democratic society freely managed by its members. To express his gratitude to Catalonia, Gamber injected the essence of Catalan cultural identity into FC Barcelona, and this essence has since defined Barcelona's image. However, Juventus, which recently rejected the acquisition of the stablecoin company Tether, was founded is also very communal. Juventus officially wrote about this history simply and bluntly: in 1897, a group of Torino high school students had the idea of building a team on a bench in a downtown street, and the club was born as a result. But what is more worth learning about Juventus is how it broke through the geographical limit of a “city club”. Juventus has national support in Italy, partly due to the migration of people from the South — so that immigrant groups support Juventus as part of their integration into city life. Looking back at the history of established European clubs, it is easy to find that their identity symbols and sense of ceremony played an important role in the community accumulation process in the early days. The team's color, name, home field location, etc. all strengthened community identity, and are good at using symbols and stories to add identity tags to themselves, thus making ordinary people identify and be proud. For example, in 1883, when the Blackburn Olympics became the first working-class team to win the FA Cup, civilians throughout Northern England rejoiced, seeing it as a sign of the grassroots victory over high society. This identity story of the underdog fighting back further ignited the enthusiasm of fans all over the world, and the club gained the first batch of die-hard fans that snowballed. For the Web3 startup community, the path that soccer clubs founded and nurtured the community 100 years ago also has reference significance. By making full use of cultural soil and grassroots strength, the project can clarify its own identity, cultural belonging, and sense of mission from the beginning of its creation. Just as workers in the industrial age came together because of shared interests, cities, and class identities, Web3 communities can also unite users based on shared values or visions. In the early days, the Web3 project was the same as...

235d agoLuxurytracy#WEB3

Economist: The countdown to the US fiscal crisis has begun

Comparatively, according to Kim 10, Kent Smetters (Kent Smetters), head of the Wharton Budget Model Project at the University of Pennsylvania, believes that the “end” will come to the US between 2045 and 2050, which is a tipping point for the US economy. At that point, the federal government's treasury bond interest payment costs will be so huge that even a massive tax increase won't help. Smets said that at that point, the US government will fall into clear or hidden default, both of which will have disastrous consequences. A clear breach would make the US a global debtor. Implicit defaults, on the other hand, could theoretically be achieved by monetizing debt (leading to inflation) or cutting social security and health insurance spending. Smets said, “At this point, panic began to spread, and it was also a time to lose trust in the government. This is also the cause of the destruction of other societies. Going back to Rome, France, Spain, England, and Germany, almost every empire has been destroyed by debt.”

288d ago

ETF Store President: Spot crypto ETFs may be approved centrally after the government shutdown is over. Ironically, the financial crisis is highlighting the value of crypto

Comparing news, ETF Store President Nate Geraci wrote on the X platform that once the US government shutdown is over, the approval door for spot cryptocurrency ETFs may be fully opened. He pointed out that ironically, fiscal deficits and political farce that hinder the approval process are the problems cryptocurrencies are designed to solve.

313d ago

USD hegemony 2.0: How can stablecoins support US finances?

Author: Chairman Rabbit/tuzhuxi Original title: A New Weapon for Dollar Hegemony: Stablecoins This week, President Trump and the crypto industry will usher in the first major legislative victory in the cryptocurrency field: US House Republicans are preparing to accept the new stablecoin regulation bill proposed by the Senate (“Global Crypto Innovation Guarantee Act”, also known as the GENIUS Act). This is the first time that the US has introduced a stablecoin regulatory framework. One of the core elements is to require stablecoin issuers to ensure that tokens are linked 1:1 to the US dollar and reserve or invest the funds raised by issuing tokens in highly liquid US dollar assets, including cash, bank statements, and US Treasury bonds. The signing of the stablecoin bill will inject strength into the crypto industry and related markets, while supporting America's fiscal needs and maintaining the status of the US dollar (dollar hegemony). The cryptocurrency industry has been wandering in a marginal zone and grey area for many years and has never been integrated into the mainstream; its supporters have always hoped to obtain legislative approval from the US government and operate under an exclusive regulatory framework, which can further open the door for the participation of traditional/mainstream financial institutions and enhance the breadth and depth of the cryptocurrency market. Earlier, the crypto industry had been lobbying Congress for many years, never waited for the right time, and there was also a dispute over the central bank's digital currency (CBDC) route. Last year, they bet on supporting Trump in the general election. After Trump won the election, they finally waited for the right time to push the relevant legislation and become the biggest beneficiary of Trump's second administration. 1. “Good time and place”: Background of the introduction of the stablecoin regulatory framework The crypto/stablecoin industry itself is of course seeking development, but it also requires other conditions to obtain political recognition and government endorsement in the US. An important background for the introduction of the so-called “timely and geographical advantage” regulatory framework is that the US faces serious fiscal sustainability issues, and the status of the US dollar is under unprecedented threat. 1. The US fiscal deficit situation The US fiscal deficit for the 2025 fiscal year is expected to reach 1.9 trillion US dollars, accounting for 6.2% of GDP. This figure is a significant increase from previous years and is the result of the continuous expansion of US fiscal policy. The “Big and Beautiful Act” recently promoted and passed by the Trump administration is expected to increase the deficit by another 3.4 trillion US dollars over the next 10 years, further worsening the situation. Market opinion leaders such as Elon Musk in the corporate world and Ray Dalio in the financial world to J.P. Morgan Chase Jamie Dimon in the financial world have all pointed out that the US government's finances have been unsustainable for a long time, and the future is bound to cause a disastrous crisis. 2. How did the US treasury depend on US debt and the financial unsustainability of the US federal government trigger an economic and financial crisis? The core is to focus on US Treasury bonds, that is, the US government's ability to finance. In a deficit situation, the US government's way of meeting fiscal needs is through treasury bonds — including new issuance and refinancing. Currently, the balance of US Treasury bonds has exceeded 36 trillion US dollars, and 80% will mature in the next four years (about 7 to 10 trillion US dollars due each year). More than 80% of investors are market-based institutions. Issuance requires accompanying market entry, and there is real pressure to refinance. Some people say, can't US bonds be sold? What are the risks? The answer is, of course, US bonds can be sold, but the pricing of US bonds is highly market-based, and common sense of economics tells us that the price is determined by supply and demand. Assuming that the market demand for US bonds does not change, other conditions are equal, when the supply of US bonds increases and the supply exceeds the market's willingness to buy, then interest rates will increase — the US government should use higher interest rates to attract investors to invest and hold US bonds. Higher interest rates will only have one result: raising the US government's financing costs while driving up the overall interest rate of the market, increasing everyone's financing costs, thus harming the economy, and not only the US economy, but the global economy — everyone has to pay irresponsibly for the US treasury — this is another side effect of the US dollar's hegemony. Therefore, when we analyze the financial unsustainability of the US government, the final analysis is US debt, how can the US government maintain a large issuance volume at a lower interest rate. There are only two methods: either reduce circulation or let more people buy it. (The reduction in issuance volume is taken from the perspective of GDP. Assuming that the size of the fiscal deficit remains the same and GDP increases, it is equivalent to a reduction in relative issuance) 3. The root cause of harming the status of the US dollar and worsening the supply and demand situation of US bonds, then can the supply and demand problem of US bonds be solved? I'm afraid it won't work under the current framework. Distribution continues to grow, while demand continues to shrink. Next, let's do a brief analysis. 1) America's fiscal carnival and deficit politics. The “Big and Beautiful” Act pushes...

404d agoburnking#stablecoins #USD

A Dangerous “Left and Right Struggle”: When Big and American Legislation Meets National Bitcoin Reserve

Source: Web3 Practitioners Original title: When Bitcoin Strategic Reserves Meet the “Big and Beautiful” Act The “OBBBA” (OBBBA) promoted by the Trump administration is bringing the US into an unprecedented policy experiment — when permanent tax cuts meet the country's Bitcoin strategic reserves, this game that combines fiscal expansion with the digital asset revolution is not only stirring up partisan disputes in Washington, but is also likely to reshape the global financial order. This legislation aimed at perpetuating the 2017 Tax Cuts and Jobs Act (TCJA) is ostensibly a continuation of economic policy, but it actually conceals America's deep logic of reconstructing financial hegemony in the digital age. The two-sided legacy of the 2017 Tax Cuts Act OBBBA's policy roots stem from the 2017 TCJA Tax Relief Act, and the controversy surrounding its effects has not subsided. In the narrative constructed by the Republican Party and conservative institutions, TCJA is the “magic key” to activate the US economy: after the corporate tax rate was reduced from 35% to 21%, the GDP growth rate, corporate investment scale, and total federal tax revenue all exceeded expectations, forming a virtuous cycle of “tax reduction - growth - fiscal balance.” They emphasized that this policy has successfully curbed corporate outflows and even allowed all income groups to share the dividends of wage growth. But the neutral agency's assessment shows a different picture. Research by the Congressional Research Service (CRS) and the Brookings Institution indicates that TCJA has little incentive effect on business investment, and that short-term increases are more due to fluctuations in oil prices and government spending. More importantly, the “tax reduction self-financing” theory has been falsified — federal revenue was actually reduced by hundreds of billions of dollars in 2018-2019, corporate income tax was cut sharply by more than one-third, and tax reduction dividends were excessively skewed towards the wealthy class and corporate shareholders, increasing the polarization of social wealth. This disagreement is essentially a difference in evaluation benchmarks: one side uses short-term growth as a yardstick, while the other is concerned with long-term fiscal health and distribution equity. The fiscal risk map behind OBBBA The Congressional Budget Office (CBO) warning is like a wake-up call: even if the TCJA tax cuts expire in 2025, the share of federal debt held by the US public will still reach 116% of GDP in 2034 and rise to 166% in 2054. And the perpetuation of OBBBA will completely step on the debt accelerator — CBO simulations show that if the TCJA continues unconditionally, the share of debt will soar to 214% in 2054, and annual interest expenses will consume 8.6% of GDP, surpassing defense spending as the largest financial burden. Market signals have confirmed this concern. Moody's downgraded America's sovereign credit rating, clearly stating that “successive administrations have failed to reverse the growing trend of deficits and interest costs,” and that its model specifically includes the assumption that “extending the TCJA will increase debt by 4 trillion dollars.” This creates a dangerous vicious cycle: the higher the debt, the heavier the interest burden, and interest expenses further drive up the deficit, which may eventually trigger the market to question the systemic nature of dollar credit. When interest on treasury bonds becomes a “devourer” of fiscal spending, the US will fall into a “borrowing the new and the old” Ponzi financing dilemma. Crypto revolution: From marginal assets to national strategic reserves While fiscal policy is causing controversy, the Trump administration is driving a top-down digital asset revolution. The 2024 Republican Party platform clearly defines the principle of “two against two supports”: it opposes central bank intervention in digital currency (CBDC) and cryptocurrency transactions that are overly monitored by the government, supports citizens' self-custody and bitcoin mining rights, and highlights liberal ideas that limit the country's financial power. Actions at the administrative level are more aggressive: the SEC formed a pro-cryptocurrency task force to break away from the “law enforcement priority” model; appointed “crypto czar” David Sachs to lead digital asset affairs; and included the government's seizure of Bitcoin in “strategic reserves” and followed the “no sale” principle, marking a leap in perception of Bitcoin from “criminal evidence” to a “national strategic asset.” Trump has repeatedly promised to make the US the “cryptocurrency capital of the world,” and a series of policy combinations show that this...

417d agoWendy#Big and beautiful #Strategic reserves #Trump #USD #financial crisis #finance #hegemony

Deep Thoughts: Should the US Establish a Bitcoin Strategic Reserve?

Author: Christian Catalini, Lightspark co-founder Compiled by Luffy, Foresight News America is benefiting from what economists call “excessive privileges.” As the issuer of the world's reserve currency, the US can borrow and support new spending in its own currency. However, this does not mean that the US can print money at will; treasury bonds must still attract buyers on the open market. Fortunately, US Treasury bonds are widely regarded as the safest asset in the world. Demand is strong, especially during times of crisis, and is a common safe-haven option for investors. Who benefits from this “excessive privilege”? The first is US policymakers, who have been given extra flexibility in fiscal and monetary policy decisions. Second are banks, which are at the heart of global money flows, earning fees and gaining influence. But the real winners are American companies and multinationals, which can do business in their own currency and issue bonds and borrow more cheaply than their foreign competitors. There are also consumers, who enjoy greater purchasing power, lower borrowing costs, and more affordable loans. What were the results? The US can borrow at a lower cost, maintain higher deficits over the long term, and withstand economic shocks that may put other countries in trouble. However, this “excessive privilege” is not taken for granted; it must be sought. It depends on America's economic, financial, and geopolitical strength. At the end of the day, the entire system depends on one key factor: trust. Trust in American institutions, governance, and military strength. Above all, trust that the dollar is still the safest place to store global savings. All of this has a direct impact on the Trump administration's proposed Bitcoin reserve. Proponents of Bitcoin reserves are not wrong about Bitcoin's long-term strategic role; it's just that the time has not come. Currently, the real opportunity is not simply to hoard Bitcoin, but to actively guide Bitcoin's integration into the global financial system to strengthen rather than weaken America's economic leadership. This means using both US dollar stablecoins and Bitcoin to ensure that the US leads the next era of financial infrastructure. Before we explore this, let's first analyze the role played by reserve currencies and their issuing countries. The history of the rise and fall of reserve currencies shows that reserve currencies are the dominant countries in the world economy and geopolitics. In its heyday, leading countries set rules for trade, finance, and military power, giving their currencies global credibility and trust. From the Portuguese real in the 15th century to the dollar in the 20th century, reserve currency issuers shaped markets and institutions, leading other countries to follow suit. But no single currency can stay dominant forever. Excessive expansion, whether due to war, exorbitant expansionary actions, or unsustainable social commitments, will eventually erode credibility. The dominance of the Spanish eight-riel silver coin, which was once strong due to its large reserves of silver from Latin America, gradually declined as Spain's debt continued to rise and economic mismanagement. The Dutch Guilder gradually declined as endless wars depleted Dutch resources. The French franc, which dominated in the 18th and early 19th centuries, weakened under the weight of revolution, Napoleonic wars, and poor financial management. However, the British pound, which was once the cornerstone of global finance, gradually collapsed under the heavy pressure of post-war debt and the rise of American industry. The lesson of history is clear: economic and military might create a reserve currency, but only financial stability and institutional leadership ensure its status. Having lost those foundations, the privileges are gone. Is the dollar's dominance coming to an end? The answer to this question depends on the starting point in time. Around World War II, the US dollar strengthened its position as the world's reserve currency through the Bretton Woods agreements, and even earlier, when the US became a major global creditor country after World War I. At any point in time, the US dollar has dominated the world economy for over 80 years. By historical standards, this was a long time, but not unprecedented. The pound also ruled for about a century before falling into decline. Today, some people think America's world hegemony is falling apart. China's rapid development in artificial intelligence, robotics, electric vehicles, and advanced manufacturing marks a shift in power. Furthermore, China has significant control over key minerals that are critical to shaping the future. Other warning signs are constantly appearing. Mark Anderson, co-founder of a16z, called DeepSeek's R1 launch an “AI Sputnik moment” for the US, a wake-up call that shows that America's leadership in the field of emerging technology is no longer stable. At the same time,...

563d agoLuxurytracy#Bitcoin #USA

Has the South Korean stock market collapsed due to Bitcoin?

Author: Chen Hanxue, Wall Street News Since this year, Asian stock markets have had mixed ups and downs in the context of a strong dollar. Among them, some achieved a bull market for stocks denominated in local currency at the cost of depreciation of the exchange rate, while others sacrificed part of the increase in the stock market with a relatively stable exchange rate. South Korea is the only exception: in terms of the Korean won, KSOPI fell 10.0% cumulatively this year. After considering the fall of the won, KSOPI in US dollars fell 18.9%, all of which are the weakest in Asia. The main declines all occurred in the second half of the year. At one point, 24H1 KSOPI rose nearly 20%, but the second half of the year erased all gains. What happened in Korea in the second half of the year? Foreign capital has fled, and residents are trading coins in groups. Judging from the direction of capital flows, since the second half of this year, only institutions in South Korea have maintained a net purchase scale in the stock market, and the residential sector has continuously reduced purchases. Foreign investors are more pessimistic. In November of this year, net sales of Korean stocks by foreign investors reached 4.15 trillion won, which has been a net sale for four consecutive months. Within two weeks from the beginning of December, there was a net sell-off of 2.4 trillion won. Most of the money that South Korean residents get out of the stock market is being “traded in coins.” Bank of Korea (BOK) data shows that as of November, the number of cryptocurrency investors in South Korea reached 15.59 million, an increase of 610,000 over the previous month. Currently, of the 51 million South Korean citizens, 30% are trading coins. The average daily trading volume of Korea's top five cryptocurrency exchanges — Upbit, Bithumb, Coinone, Korbit, and GOPAX — jumped from 3.4 trillion won in October to 14.9 trillion won in November, more than quadrupling. South Koreans have always been keen to invest in cryptocurrencies. When the first wave of the cryptocurrency bull market was in 2017, about 5% of the population participated; in the second round of the 2021 bull market, 10% of the population participated; now this ratio has increased to 30%. However, historically, the Korean stock index was positively correlated with the Bitcoin price as a whole; until October of this year, this positive correlation was completely broken. So the South Korean stock market is falling, and is Bitcoin going to take over? Is the exit really strong? In 2023, South Korea's exports accounted for 40% of GDP. As an export-oriented economy, exports are a barometer of the Korean economy. South Korea's exports seem to be picking up recently. According to the November export data released by the Korea International Trade Association, the export value in November increased 1.4% year on year, and continued to increase for 14 months, but the trend has slowed; the export value data for the first 10 and 20 days of December released by Korea Customs increased 12.4% and 6.8% year on year, respectively, which indicates that South Korea's exports should not weaken in December. But behind this phenomenon, it is more likely that Trump's tariff concerns are rushing. Starting from the fundamentals of exports, South Korea's main export industries, such as semiconductors, automobiles, and chemical products, are facing unfavorable prospects. Figure: South Korea's export structure in 2022 First, the weak side of semiconductors. South Korea's semiconductor giants Samsung Electronics and SK Hynix mainly focus on memory chips, and memory chips only account for about 30% of the entire semiconductor market. Compared to Taiwan, which has a complete supply chain including chip manufacturing, packaging, and testing, South Korea's presence is weak. According to Trend Force data, TSMC's share of the global foundry market in the second quarter of this year was 62%, while Samsung Electronics was only 11%. The gap between the two companies widened from 36.5% of 2020Q3 to 51% today. The main reason is insufficient policy support. South Korea lacks government subsidies similar to the US, mainland China, and Taiwan, making it difficult to promote chip localization. Korean semiconductors are also highly dependent on overseas for their key materials, components, and equipment. According to data from the Korea Customs Service, more than half of the 13 segments of semiconductor equipment have been in trade deficits for a long time. In particular, the government of Yoon Seok-yeol chose a hard decoupling from the Chinese market, leading to a cliff-style decline in the Korean semiconductor industry, which is extremely dependent on the Chinese market. Among China's chip imports in 2023, the share of chips shipped by Korean companies has dropped to 6.3%, and has remained above 10% until now. Second, the automobile manufacturing industry is also clearly at a disadvantage in competition. In 2023, the total global sales volume of Korean cars was more than 8 million units, an increase of more than 7% over the previous year, but the share of new energy vehicles was only 9.3%. China is currently the largest and fastest growing NEV market in the world. Mid 2023...

603d agoburnking#Bitcoin #Korea Stock Market

Bank for International Settlements: Fiscal consolidation will eventually reduce the need to maintain high interest rates

Comparing news, the Bank for International Settlements (BIS) issued a warning to debtor countries on Sunday that market confidence may be suddenly lost, confirming people's long-standing concerns about the cryptocurrency market. According to some cryptocurrency experts, both Bitcoin and gold portend a fiscal crisis for the US and other developed countries. So-called zero-yield assets have risen 48% and 13%, respectively, this year, supposedly due to safe-haven demand. While cryptocurrency proponents see BTC as the opposite of fiat money's downturn, this cryptocurrency tends to fall along with other risky assets during times of stress. The consensus in the cryptocurrency market is that rising debt concerns will force the Federal Reserve and other central banks to cut interest rates, thereby spurring more investors to flow into alternative assets such as Bitcoin. Traders expect the Federal Reserve to cut interest rates twice this year by 25 basis points, according to the Chicago Mercantile Exchange's FedWatch tool. The Bank for International Settlements added that fiscal consolidation will ultimately reduce the need to maintain high interest rates. “As far as fiscal policy is concerned, fiscal consolidation is an absolute priority. In the short term, this will help ease inflationary pressure and reduce the need to maintain high interest rates, which in turn will help maintain financial stability.”

782d agoburnking#Bitcoin

5 truths behind the central bank's digital currency “punching Alipay and kicking Bitcoin”

This article was originally written by the public account “Suning Institute of Finance”. The author is Xue Hongyan, Deputy Director of the Suning Institute of Finance. Everybody loves the RMB. The central bank's digital currency is getting closer and closer, igniting public enthusiasm. Some people are bad at money knowledge and are concerned about issues such as “what” and “why”; others are passionate about eating melons and are concerned about topics such as “what to do with Alipay,” “what is the future of Bitcoin,” and “the hegemony of the US dollar is facing a fatal blow.” Punch Alipay, kick Bitcoin, and challenge the hegemony of the US dollar. I have to say that the entertainment industry eats too many melons; they have all eaten the financial sector. What's the truth? In this article, we'll try to answer them one by one. The reason for this is an attempt at an answer, because any unofficial interpretation is subjective speculation. What is a central bank digital currency? Central bank digital currency is first and foremost a type of currency. What is currency? Money is a unit of account and a lubricant for economic activity. You can think of money as a bill of lading, behind which there is a right to claim goods and services, so money also becomes a symbol of wealth — people hold and store money with the intention of one day exchanging it for the goods and services they need. Regarding money, the economist Hayman Minsky famously said, “Everyone can create money, but the question is whether it can be accepted.” This means that in an economic sense, everyone can issue money, but not everyone can issue a currency that is accepted by the public. Some people are willing to accept Bitcoin, so Bitcoin can also perform monetary functions within a specific range and become a kind of “virtual currency” (many countries, including China, do not recognize its monetary attributes). In the modern economic context, currency usually refers to legal tender. It is issued by the central bank. It has legal and mandatory characteristics, and no one can refuse to accept it within the border. The RMB is the legal tender in China and corresponds to different forms of currency: cash notes are RMB, behind bank deposits are RMB, and the central bank's digital currency is also RMB. So, what is a central bank digital currency? You can think of it as a renminbi that exists in digital form. Since they are all RMB, they must be interchangeable between different forms — digital currency can be exchanged for cash or bank deposits; conversely, cash and deposits can also be exchanged for central bank digital currency. The question is, cash and current deposit accounts can already meet everyone's payment needs. From the user's point of view, why do they need central bank digital currency? Indeed, when analyzing the necessity of central bank digital currency, experts mostly base it from the perspective of central banks and financial institutions. For example, compared to cash, digital currency can save printing costs, and there are no problems with damage, replacement, or banknote transportation, and can greatly reduce the cash management costs of the financial system. Compared with bank deposits, digital currency can trace the flow of funds, and small ones prevent illegal entry of credit funds into the stock market and property markets, and generally play a role in anti-money laundering and anti-terrorist financing. Where are the benefits for ordinary people reflected? The advantage is that it is anti-theft, because it is traceable, and there is no fear of theft. The inconvenience is reflected in the need to re-cultivate a habit of using money. Of course, there is no need to worry. There may be more and more scenarios that support digital currencies in the future, but all scenarios will be compatible with cash and credit card payments. As far as users are concerned, whether or not to use central bank digital currency will not affect our daily lives at all. Will central bank digital currencies replace cash? To a certain extent, the central bank's issuance of digital currency is also following the trend — in line with the trend of a “cashless society” and providing a better payment carrier for the digital economy. So will central bank digital currency replace cash? It won't. The term “cashless society” was very popular in 2017. Not only did payment giants take advantage of the momentum to promote it, but even some merchants began refusing to accept cash, causing a great deal of controversy, and came to an end with the central bank's statement “refusing to accept cash as an illegal act.” Since then, no one has promoted a “cashless society,” but the “cashless society” has not stopped penetrating. The use of cash is burdened with significant operational and management costs, and the country has always encouraged reducing the use of cash in economic activities. For example, the “Interim Regulations on Cash Management” introduced in 1988 clearly state that “the state encourages account holders and individuals to use transfer payments to reduce the use of cash in economic activities,” but for enterprises, it is clearly stipulated that they can only use cash under limited conditions and not exceed a certain amount; otherwise, it is suspected that it is illegal. Otherwise, it is difficult for cash payments to track the flow of funds. Large cash transactions are often the hardest hit area for gray transactions and illegal transactions. From an enterprise's perspective, large cash payments can also cause problems such as anti-counterfeiting identification and cash storage, and are generally more likely to accept electronic transactions. However, for small sporadic transactions, cash has irreplaceable advantages. The biggest advantage is that it is highly flexible and versatile. There is no need to rely on third-party devices and networks, but...

2303d agody zhang#Central bank digital currency #WeChat #Alipay

Coinbase CEO: America's massive issuance of treasury bonds will be a major blow to the financial system

Crypto exchange Coinbase CEO Brian Armstrong said on Twitter that the massive issuance of US treasury bonds would be a major blow to the financial system. This week the US Congressional Budget Office (CBO) released a new study showing that the number of US Treasury bonds issued will soar to $31.4 trillion over the next ten years. Armstrong tweeted the study and suggested “considering cryptocurrencies,” which he believes will be a major blow to the financial system and make cryptocurrencies more robust than the dollar. Armstrong mentioned, “Cryptocurrency is considered a real currency that cannot be tampered with; at least its control is decentralized, and people can censor open source code. Why should your labor income be manipulated or devalued?” According to CBO research, $31.4 trillion in debt would be the highest level since World War II, equivalent to 98% of the US GDP. CBO chief Phillip Swagel said during the House Budget Committee hearing on Wednesday that there is still time to deal with fiscal challenges, but treasury bonds are now on an unsustainable path. According to the study, this level of debt would dampen economic output. Rising interest costs associated with debt will increase interest payments to foreign debt holders, thereby reducing the income of American households. A sharp increase in federal borrowing would also increase the risk of a fiscal crisis. Additionally, it may limit lawmakers' ability to adopt fiscal policies to respond to unforeseen events or use them for other purposes, and some negative economic and financial impacts will also be more likely to occur. Armstrong believes it's only a matter of time before people begin to realize the reason for the dollar's depreciation, a fundamental shift in the way people think about cryptocurrencies. He said, “Most people today probably still view cryptocurrencies as speculative assets. But I'm sure we'll see this perspective shift, and many things may start with young people, in which case holding government fiat money would be seen as ridiculous.” Image source: Coinbase author Xiu Mu This article is from Bitpush.news. The source is required for reprinting...

2397d agoLiang#Brian Armstrong #Coinbase #cryptocurrency #USD

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