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The national cryptocurrency of China will appear till November 11; JP Morgan predicts the US currency collapse. The TON project will be launched in two months.
According to Forbes, the People’s Bank of China plans to launch its own national cryptocurrency till November 11, 2019. It is intended to replace cash in circulation, but will not compete with the non-cash yuan. Seven organizations will be allowed to implement the project in the first stage. Moreover, these are not only banks, but also the companies such as Alibaba and Tencent.
They will be entrusted with the task of new financial asset distributing among individuals and enterprises. The group of the first-stage recipients includes also other eight largest companies of the country. In general, there is a challenging task to bring cryptocurrency of China to 1.3 billion users. The information received is fully consistent with the previous rumors that a two-tier operational structure will be used in China.
According to statements by the People’s Bank of China, the main works on the technological development of the state cryptocurrency of China were completed back in the previous year. Moreover, the project was speed up after the publication of Libra White Paper. According to the authorities, they will not allow unjustified preferences for the United States and their economic allies after the launch of global Facebook tokens.
The technology used in the Chinese blockchain is expected to enable up to 30,000 transactions per second. The country’s financial authorities are confident that digital yuan will be distributed worldwide, including also the US. It turns out that first-ever in the global financial system, the American consumers will actively use another country’s currency to conduct transactions.
It is unlikely that the US will agree with this state of affairs, although, now the country has nothing to oppose to the cryptocurrency initiative of China. A direct ban may not work, at that they will not be able to offer an alternative. The launch of Libra project has been postponed for an indefinite period; the regulators have virtually frozen its progress by debates and attacks because of supposedly existing issues of personal data security.
According to JP Morgan report published on Twitter, dollar devaluation will lead to loss of its title of the world reserve currency in the next decade. Accrued expenditure and unwillingness to increase the budget revenues will lead to a deficit of $ 1 trillion. This will inevitably force investors to look for more stable funds storing means.
Considering this, digital financial assets are entering the picture in addition to the traditional gold. It is likely that cryptocurrencies will replace dollar in national and cross-border settlements. The paradox is that the US authorities can set nothing against the impending crisis. Government debt is constantly increasing. With that said, in 2000 it amounted to $ 5.6 trillion, and in 2019 it has already risen beyond $ 22 trillion.
Even at the height of trade war with the US, China owns $ 1.1 trillion of the US government bonds. The exit from these assets can provoke a global sale, which will result in unpredictable consequences.
Against this background, the statement made by Mark Carney, Bank of England Governor, sounded quite strong. He declared that cryptocurrencies will push dollar out of the global financial market. The reason lies not so much in the accumulating American currency weakness, but in its discrepancy with modern technological realities.
Until now, the international financial calculations needed a basic asset which role was played by fiat currencies. Blockchain can manage without this option. Consequently, dollar loses its reserve function like other fiat money. However, Mark Carney offers a way out of this situation. He believes that Libra by Facebook or similar cryptocurrency projects under the state control can stabilize the state of things. They will allow making a smooth transition to a new settlement system.
By agreement with investors, Telegram has to start launching its Gram cryptocurrency in TON network till October 31. Otherwise, it undertakes to return $ 1.7 billion collected during the initial offering. According to the New York Times, blockchain developers plan not to wait until the last moment, but to launch Gram tokens earlier than the date specified.
It is already known that, similarly to bitcoin, the decentralized structure will be at the bottom of Telegram blockchain. That is, the company will not have full control over the tokens movement, which corresponds to the project philosophy. However, this may raise questions from regulators who suspect cryptocurrencies of illegal money transfer.
In July, Liquid cryptocurrency exchange started Telegram tokens selling publicly available. Some investors sold their assets, and the price three times exceeded the purchase price. Initially, only large investors were able to purchase coins through private subscription having invested at least $ 10 million in the project.
Back in spring 2019, professional testing teams gained access to the Light Version of TON client. However, at this stage it was impossible to accurately make an assessment of the potential of transaction processing speed and the entire system reliability. In addition, there are some questions about blockchain ability to scaling.
At the present moment, people expect public launch of the test network that is able to answer questions about Telegram blockchain possibilities in actual practice. However, as of today, the company has not announced the launching date.