The United States National Intelligence Director expressed his worries about China’s digital currency influence as we are reading more in today’s crypto news.
America’s intelligence community raised many concerns about the upcoming Chinese digital currency and the influence that it will have. The SEC received communication detailing the concerns of the community. China’s digital currency development was taking place in 2014. The National Intelligence Director John Ratcliffe wrote to the SEC chairman Jay Clayton about the concerns of the Chinese digital currency earlier this month.
China was on the digital currency path since 2014 when Xiaochuan Zhou who is the governor of the People’s Bank of China established the Digital Currency Research institute so the US took a more cautious approach. Last month, the chairman of the US Federal Reserve Jerome Powell suggested that it is more important to get it right than to be first but it now seems that the US is concerned China took it too far. Jason Brown, the director of business development for Komodo said:
“Unfortunately it is a rather pessimistic outlook, to give US companies a level playing field with the Chinese would require massive deregulation of US securities laws, many of which have been in effect for the better part of a century.”
While the US are anxious about China’s lead in the crypto space, there needs to be a serious upheaval of the regulatory rulebook for the country to catch up. What’s even more, when the regulators are put in place to protect the consumers, the rules end up not being followed abroad and the competitiveness of America gets undermined. Brown added:
“These regulations that were intended to protect everyday citizens become an unnecessary burden placed on US companies that effectively handicaps Americans’ abilities to access global capital.”
However, other than the restrictions for digital currencies, the US appears to be concerned about China’s stance on cryptocurrency. The senior intelligence official said that “there are serious national security concerns about China’s control over bitcoin and Ether.” These concerns could base on the fact that China remains a BTC mining powerhouse due to the environment of making BTC mining a lucrative venture in the rainy season. Tarak Kulyk, the senior vice president of Core Scientific said:
“The weather is a key driver of profit for many Chinese miners, as they can buy old equipment for cheap, but can only be profitable for five months of the year.”
Once the rainy season ends in China, the country will continue its commitment to embracing digital currency. Back in September, the China Finance magazine described digital currencies as the “new battlefield.” Jerome Powell could think that it is better to be right than first but China could aim for both.
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