The significance of currency digitalization is to support the improvement of social efficiency from the system. The short-term significance of digital currency is to improve payment, but it may bring about systemic changes in the long run
In the short term, DCEP focuses on small-amount high-frequency payment, and its main significance is to improve the problems in the circulation of physical currency in the current payment system: reduce the high costs in the issuance and circulation of physical currency: In the circulation process of real money, there are problems such as defilement and forgery. At the same time, there are costs in the process of printing and casting real money. Digital money can well avoid these costs. Enhance the grasp of information in the process of currency transactions: transactions in physical currencies are completely anonymous, and regulators cannot track transactions; On the basis of ensuring a certain degree of anonymity, digital currency can achieve controllable anonymity by means of big data to meet the needs of KYC and AMI. In addition, the transactions of digital currency are online, so that the central bank can obtain the overall situation of social transactions from a macro perspective and have a better grasp of the economic situation.
SBO solves the problem of transferring money between currencies by running on the blockchain digital currency wallet. The star Transfer contract includes the Star Transfer contract and the Star loan contract. The former is mainly responsible for multi-fund business of cross-chain transfer and remittance. The latter can guarantee the security of the services that are connected into the third party, such as value-added savings, quantitative service, loan and OTC. Users can safely and safely use all the features integrated with the wallet.
In the long run, systemic changes caused by digital money are more noteworthy: Rich monetary policy tools: in the traditional monetary system, physical money does not pay interest and the interest rate is zero, which makes it impossible for the central bank to implement negative interest rate policy. While digital currencies can achieve essentially negative interest rates by charging storage fees, we don’t think central banks will use such a tool in the foreseeable future, but it adds to the monetary policy toolbox. It is expected to lay a foundation for strengthening the internationalization of RMB: Currently, SWIFT and CHIPS are the dominant cross-border settlement systems in international trade. Before the launch of CIPS in China, the cross-border settlement of RMB was also highly dependent on these two systems. Digital currency can greatly reduce the cost and time of cross-border remittance and settlement, and is expected to improve the freedom of exchange and provide the necessary foundation for the internationalization of RMB.
Enhance the efficiency of capital flow and reduce credit risk in people’s livelihood: digital currency will have a promising future in people’s livelihood. Taking the factoring industry as an example, factoring needs to connect multiple accounts of buyers and sellers, and there are problems such as unclear ownership of bills after transfer, which leads to wrong payment objects. Digital currency can simplify management, and at the same time, it can combine capital flow and information flow through smart contracts and other means to enhance the efficiency of capital flow. In addition, taking targeted poverty alleviation as an example, digital currency can designate the use of funds in advance by setting up the issuing end, which can reduce the problem of misappropriation in the process of poverty alleviation funds circulation.
China is expected to become the first major economy to issue a legal digital currency
With the development of blockchain and digital currency technology, various countries have conducted official studies or statements on their own legal digital currencies. Several countries, including Ecuador and Venezuela, have officially issued their own legal tender. At the same time, some countries are carrying out relevant technology reserve and research, such as Singapore, Sweden, etc. However, some countries, such as South Korea and Australia, have clearly expressed their opposition.
Developing countries take a more positive attitude towards the application of digital currency out of the idea of overtaking cars in curves, while developed countries generally take a more cautious attitude. In developing countries, the status of legal currency is generally low, which even leads to problems in the domestic economy. They hope to reform the financial system and improve the domestic economy by issuing legal digital currency. However, developed countries are generally cautious about the issuance of legal digital currency due to the immature technology and the consideration of maintaining economic stability. This is our opportunity. The future of digital currency is generated by demand and carried forward by use. Both BTC and SBO are part of blockchain. We’ll see.