If we summarize the nature of Bitcoin,
Blockchain Type: Public Blockchain
Operator: Fully decentralized motive by distributed miners
Value safety: instability
Financial management: 100% of money movement is recorded, but no third-party intervention
Security technology applied: public key encryption technology, PoW
However, if we summarize the characteristics of DCEP coin, which is China’s Digital Currency Electronic Payment,
Blockchain type: Private blockchain
Centralization: State-led centralization
Operating entity: People’s Bank of China
Value safety: 1DCEP = 1 yuan maintained
Financial management: 100% of money movement is recorded and intervening financial management
Security technology applied: public key encryption technology, PoS
A representative of the People’s Bank of China accidentally gave a presentation to Charles Hoskinson, co-founder of Cardano (ADA), about the digital yuan (DCEP), a proof-of-stake cryptocurrency like the ADA, who said that the DCEP system is very sophisticated and has already been extended, and many people have heard of it. It is said that he was very surprised to find out that he was using this. Cryptocurrency top technology experts are acknowledging the excellence of China’s cryptocurrency technology. This is effectively a state-led development and testing of Proof of Stake (PoS) cryptocurrencies, while China banned the use of PoW-based cryptocurrencies such as Bitcoin.
DCEP currently has 40 million users, is scalable enough to process 10,000 transactions per second, and uses a quasi-account model (for reference, Cardano uses the eUTXO model and Ethereum uses the account model) to make smart It is easy to process scripts such as contracts, and it is very closely connected with some of the existing payment systems such as WeChat and Alipay, so there is also interoperability with the existing systems.
It seems clear that China’s ambitions are to combine this digital currency (DCEP) with the social credit system and tie it to the Belt and Road Program.
While the US has not been able to determine the exact scope of regulation for the cryptocurrency technology occupied by the U.S. and has failed to provide a regulatory direction, China has been preparing China’s cryptocurrencies as well as fearfully led by the state.
The United States has left the cryptocurrency development and industry to the private sector. Therefore, the direction pursued by cryptocurrency is different. One of them is Cardano’s ADA, which aims for a world of free financial transactions beyond the control of the existing financial system. This direction has led to a backlash from vested interests, and although it is the ADA with the best technology, its value is falling as soon as it falls.
According to Hoskinson, this crypto leftist, liberal (the left is the liberal in the crypto world), China’s current model is ultimately to give a few individuals economic control over the lives of billions of people. The antidote to this, he says, should be digital assets like ADA that focus on freedom rather than central bank digital currencies (CBDCs).
If DCEP spreads, Hoskinson’s view is that a few will exist as a monetary system with full and absolute control over the economic freedoms of billions of people. This is not an exaggeration. China is a state-led, active project based on outstanding technology and outstanding spirit. By 2017, when Facebook was already trying Libra, Libra and DCEP had similar directions and similar technical skills. However, Libra’s project disappeared due to backlash from the existing financial circles, but China’s DCEP has been developing the technology step by step and increasing the number of users, led by the state.
DCEP is already in beta with 40 million users and will spread like wildfire, first across China and then in all countries that adopt the renminbi and renminbi as their reserve currency. This is the reality that American authorities must face. If this goes on, the yuan may move forward as a global currency with the cryptocurrency DCEP, just as China leads mobile communication technologies (4G, 5G) and electric vehicles. Of course, there will be counters from the US.
Charles Hoskinson of Cardano (ADA) has a broad vision for the future of crypto assets. According to him, the antidote to Chinese cryptocurrencies is cryptocurrencies with free assets, not other CBDCs (U.S. Central Bank-issued cryptocurrencies) such as digital dollars or similar. He says he will continue to fight them as he goes down the path of decentralized cryptocurrencies.
Charles Hoskinson has a broad vision of the future of crypto assets.
“A crypto project like ADA could one day become a global financial system, but for this to become a reality, the U.S. government must adopt favorable crypto regulations”
“It is necessary to take it to the next level. As many of you know, we want Cardano and cryptocurrencies in general to be the financial operating systems of the world.”
“A great passion for my life has always been to leave it to a bankless bank and give them a bankless economic identity they can control. It is independent and ultimately global and guarantees human rights, freedom of association, commerce and expression.”
“Achieving this will require a regulatory framework that acknowledges the existence of cryptocurrencies, views it as a positive thing and appreciates the freedom it provides to people.”
Charles Hoskinson of Cardano ( ADA ) also says:
“China’s digital yuan project will infringe on people’s financial freedom.”
The direction Charles Hoskinson is pursuing in the cryptocurrency world is clear. It is not CBDC, which is a digital dollar equivalent to DCEP in the United States, but cryptocurrency as a free digital asset.
Digital assets with freedom and existing financial management systems are difficult to reconcile, and this is a problem.