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Virtual currencies as a weapon of state control

By NexChange

Do governments see crypto-currencies as a threat or a tool?

At the Asian Financial Forum in Hong Kong this week, former Federal Reserve chairman Ben Bernanke was adamant that Bitcoin et al would not become mainstream. State authorities would resist its adoption because of its anonymity and hence use in drug trafficking and for financing terrorism, he argued.

Yet, the People’s Bank of China (PBoC) said on Wednesday that it plans to issue its own digital currency to cut the costs of circulating traditional paper money, boost policymakers’ control of money supply and improve the efficiency of global transactions, reports Asia Times.

Virtual currencies can also help boost the transparency of economic activities and curb money laundering and tax evasions, [said the PBoC].

Photo: Steve Jurvetson

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