The controversial, but groundbreaking news that Facebook would be developing its own cryptocurrency apparently has created the urgency for others around the world to do the same. On the tails of the Facebook announcement, the CEO of Huawei has called upon the Chinese government to catch up and create their own virtual currency token. It is the belief of Ren Zhengfei that China cannot afford to fall behind when it comes to blockchain technology.
Huawei has had controversies of its own in the past few months, but nonetheless, it is encouraging for blockchain’s future that large entities see it as a priority to maintain a presence in digital currencies and compete for the upper hand. As for Libra’s future, Facebook should be taking note of China’s interest in creating their own digital currency for the masses. China figures to be a huge user base for Facebook’s currency and they stand to lose a lot of that user base if China is able to beat them to the market with a more robust solution. Though Facebook is banned in China, there has been significant interest in Libra from Chinese citizens.
The distinction between what Facebook is implementing and what Zhengfei is suggesting is large. Zhengfei is in charge of one of the largest companies in the world but is suggesting that the Chinese government and the People’s Bank of China take the lead on establishing a national cryptocurrency and payments system. In any case, the race isn’t just limited to Facebook and China. The world economy has realized how profitable an effective and robust peer-to-peer and retail payments solution can be.
The winner of this race figures to be well-situated in the coming years as digital payments become more and more popular.