Author Gian Volpicelli on the Digital Yuan and the Politics of CryptoNov 1, 2021
Most people think of cryptocurrency as technological innovation. But Gian Volpicelli, Senior Editor at Wired UK and author of Cryptocurrency: How Digital Money Could Transform Finance, sees it as a political matter.
"There have been various waves of political movements in crypto," he told Orchid's Derek Silva on this week's episode of the Priv8 Podcast. "It started with the cypherpunk origins of Bitcoin and Ethereum. Later, there was Facebook's Diem (formerly Libra), when one of Silicon Valley's largest companies tried to become a currency printer.
"Diem was so deeply political that the project is now dead in the water. However, its presence did contribute to a recent surge in central bank digital currency (CBDC) development—for example, China's digital yuan."
For Gian, the advent of the digital yuan represents the antithesis of the early cryptocurrency movement. "The digital yuan will be a surveillance tool," he said. "It's the total opposite of what crypto was supposed to be.
"It will bring its users some benefits. It could be faster and more convenient than legacy payment systems. But it undermines the grassroots, anti-establishment political rationale for adopting cryptocurrency. And when you remove that, you're left with a husk."
Gian believes that the creation of the digital yuan is politically motivated. "There's a theory that China is hoping to position the digital yuan as the new world reserve currency, and that therefore, the United States should hurry up and launch its 'digital dollar' to face up to the challenge.
"I suppose that one should be looking out for what happens during the Winter Olympic Games in 2022, when international people will be given access to the digital yuan for the first time," he said.
You can listen to Derek's entire conversation with Gian here. And don't forget to subscribe to Priv8 on your favorite streaming service.