News from the future
Dateline: 13 March 2019
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Several emerging economies are in a desperate tech race to be the first to establish a blockchain based fiat currency with global acceptance. The contenders, perhaps surprisingly, are the new giants, China and India, and little-known South Africa.
Rich countries are too rigid in their financial structures and too protective of their established reserve currency status to risk a game changing innovation like this. An upsurge in nationalism and rejection of globalisation by America, Britain and Europe has left the door open for radical innovation in global finance and payments by new contenders.
China already dominates world trade, and has been contemplating the eYuan for a while. India is well-positioned to launch the iRupee, with its highly developed software and service sector, and recent reforms to its financial system. South Africa, for its own part, has always had a very sophisticated and stable banking and financial services sector, virtually untouched by the financial crisis of 2008. The former weakness of the South African Rand has been ascribed to purely political factors.
Now all three countries are embracing blockchain technology and reforming laws to facilitate the launch of digital currencies for global use. They will be entirely free of exchange controls, and offer the best anonymity and encryption that modern technology can offer, globally, but will be for digital use only. Cross-border transaction costs are expected to be as close to zero as possible, and effected in real time.
The difference between these new offerings and something like Bitcoin is that they are fiat currencies at heart, and backed by the central banks of their sovereign nations, but freely transmutable on global networks.
President Donald Trump has reportedly tweeted that "America will never recognize anything but the Almighty Dollar!" Outside of the United States, however, there is great anticipation for chaincash. Who will have first mover advantage?
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