Bank of China ex-VP says Bitcoin will harm dollar’s hegemony
Wang Yongli, former vice president of the Bank of China, has criticized US President-elect Donald Trump’s Bitcoin reserve proposal, arguing it conflicts with Trump’s goal of maintaining the dollar’s global dominance.
“Bitcoin’s decentralized nature offers no advantage to bolstering the dollar’s global status. On the contrary, excessive deregulation and hindering the development of a digital dollar could harm the dollar’s international position,” Wang wrote in an opinion piece for China’s state-backed financial magazine.
Trump’s Bitcoin dreams contradict his goals for the dollar, former Bank of China VP says. (David McBee)
The former banker questioned the feasibility of establishing a national Bitcoin strategic reserve, warning that both a government or central bank Bitcoin reserve would pose significant risks and uncertainties.
He highlighted the limitations of the US Treasury Department’s Foreign Exchange Stability Fund, valued at $206 billion as of the end of November, noting it would be insufficient to establish a meaningful reserve without incurring additional debt. He also said that seized Bitcoin — Trump’s original proposal was to turn Bitcoin seized from Silk Road and other criminal enterprises into a stockpile — should be returned to their rightful owners.
Recent US policy shifts, including the approval of spot Bitcoin exchange-traded funds (ETFs) and Trump’s election victory as a pro-crypto candidate, have prompted some former Chinese officials to reassess the country’s approach to cryptocurrencies. Former vice minister of Finance Zhu Guangyao has publicly advocated for a reevaluation of China’s crypto policies, while former finance minister Lou Jiwei has urged closer monitoring of cryptocurrency developments.
Last year, speculation suggested that China might soften its stance on cryptocurrencies by the fourth quarter. Although that did not materialize, the nation has continued to advance pilot trials…
..
