The impending launch of Facebook's Libra cryptocurrency is seemingly having many implications on both economic and political fronts around the globe. Especially this development is seen with utmost interest among the business circles in China and the strained relationship with the US and the country is also one factor behind this unnerving excitement. The launch of the Facebook stablecoin is sure to make China’s envy about having its own cryptocurrency, which could be based on its digital payment platforms.
Fuelling speculations is the report in South China Morning Post which divulged details about the possibility of China getting its first sanctioned cryptocurrency almost around 2 years after the country officially banned all digital coins. The People Bank of China (PBoC) is reportedly looking into the intricacies of providing such permission and if it happens, WeChat is considered to be the strongest contenders to take the initiative and jumpstart the crypto revolution in the country.
WeChat owned by Tencent is the most popular social media platform in China and also offers the convenience of digital payments. Its popularity can be assessed by the fact that on a global scale, WeChat has around 1.1 billion monthly active users, while Facebook leads the pack with 2.3 billion active users.
Reason behind Change of Heart
Chinese authorities are concerned that even if a fraction of Facebook users start using its Libra cryptocurrency, then it could certainly undermine the economic and monetary policy of the country, its financial stability, and in larger terms, the sovereignty of China.