Digital currency

This photo on 26 November 2021 shows journalists gathered at a train station in Kunming to join a preview ride on the China-Laos railway, which is set to start operating in early December 2021. (CNS)

Laos hopes for economic boost with the opening of Laos-China railway

ISEAS academic Nick Freeman says that Laos’ first major railway, inaugurated on 3 December 2021, will create a new link with the Chinese market and has the potential to be a game changer for the Lao economy. This comes at a good time, as Laos seeks post-pandemic recovery in 2022. But the opening of the railway alone does not guarantee such a prospect. While the railway might boost industries such as tourism and exports, leading to a shift away from traditional sectors such as power generation and mineral mining, Laos needs to develop economic "muscle tissue" to ensure that the potential of the railway is translated into tangible results through investing in both hard and soft infrastructure.
Visitors are pictured in front of an immersive art installation titled "Machine Hallucinations — Space: Metaverse" by media artist Refik Anadol, which will be converted into NFT and auctioned online at Sotheby's, at the Digital Art Fair, in Hong Kong, China, 30 September 2021. (Tyrone Siu/File Photo/Reuters)

Metaverse: A chance to build a better world

Academic Pei Sai Fan says that one should dream big with the metaverse and not only see it as a new avenue of making money. By creating a new virtual universe from scratch, we can make good use of the blockchain-based metaverse to promote an equitable, more transparent and more inclusive rules-based international digital currency and financial system and enhance the global governance system to deal with issues facing all countries. This would require a global approach and China is well placed technologically to actively participate and lead the effort with like-minded nations in creating such a metaverse. It would be a pity if countries squandered such an opportunity to truly build a better world for all mankind.
Computer games are seen at a store in Beijing, China, on 10 September 2021. (Greg Baker/AFP)

Will overregulation kill Chinese firms' metaverse ambitions?

The metaverse is the latest tech industry buzzword that has generated great interest among Chinese tech companies and China's capital market. Not everyone is equally enthusiastic, however, as Chinese authorities appear to be taking a cautious approach, attempting to strike a balance between regulatory control and the risk of stifling innovation. Caixin explores what's in store for the metaverse.
China's official app for digital yuan is seen on a mobile phone next to 100 RMB banknotes in this illustration picture taken on 16 October 2020. (Florence Lo/Illustration/File Photo/Reuters)

China’s central bank digital currency has huge potential, but be careful of overregulation

Central bank digital currencies (CBDCs) can potentially optimise and vastly improve the central bank’s monetary policy transmission with preset conditions to incorporate forward-looking and counter-cyclical features. This means that central banks can accurately control the amount, direction and intensity of liquidity or money supply flowing to the desired industries, thereby allowing industries to achieve an optimal level of production and reduce the risk of inflation or deflation. Earlier this year, China tracked and paid wages to builders in Xiong’an using its digital RMB, e-CNY. Is this a harbinger of things to come?
A man plays an online game on a computer at an internet cafe in Beijing, China, 31 August 2021. (Florence Lo/File Photo/Reuters)

A metaverse with Chinese characteristics?

Facebook’s Mark Zuckerberg recently said, “Think of the metaverse as an immersive virtual world where people can spend time together and hang out, much like you can do today with virtual reality, dialed up to 11.” Stocks of companies working on constructing the said metaverse have been on the rise. China, with its huge video game market, should have a head start in this realm, but authorities are sounding words of caution. They fear the metaverse will be as ephemeral as it seems and worse, even harder to regulate. How will it get a piece of the pie in its own way?
Cryptocurrency representations are seen in front of an image of the Chinese flag in this illustration picture taken 2 June 2021. (Florence Lo/Reuters)

China’s crackdown on cryptocurrencies: Trade-offs between stability and innovation

China’s crackdown on cryptocurrencies has increased the volatility of the market, not least with bitcoin miners fleeing and the price of bitcoin plummeting. What are the reasons behind China’s regulatory clampdowns and will other countries follow suit?
This photo taken on 1 April 2021 shows a worker adjusting cryptocurrency mining rigs at a cryptocurrency farm in Dujiangyan in China's southwestern Sichuan province. (STR/AFP)

China’s crackdown on cryptocurrencies: Bitcoin miners eyeing overseas ventures

Bitcoin mining has been a huge money spinner for many people in China, not least in the less developed areas where it can be a lifeline out of poverty. While some Bitcoin miners have been put in a very difficult position with the Chinese government's recent clampdown on Bitcoin mining farms, they are not giving up yet.
A rapidKL train travels along an elevated track above streets in Kuala Lumpur, Malaysia on 1 June 2021. (Samsul Said/Bloomberg)

Chinese companies see ASEAN as a bright spot for investment

According to a pulse survey conducted by Standard Chartered, Chinese companies are attracted to ASEAN’s large market and potential as regional production bases. External factors such as the Regional Comprehensive Economic Agreement (RCEP) could also funnel greater Chinese investment into the region in areas such as high-value manufacturing, energy and digital services.
A sign indicating digital yuan, also referred to as e-CNY, is pictured at a shopping mall in Shanghai, China, 5 May 2021. (Aly Song/Reuters)

China’s central bank digital currency (CBDC) innovations

In part 2 of his article on China’s digital currency ambitions, James Pang takes a look at how a Chinese central bank-issued digital currency — the DCEP — can complement existing e-payment methods and have an edge over traditional cash and cryptocurrencies when it is fully rolled out. Being the first major economy to launch a CBDC, China’s experience will be useful for other countries looking to hop onto the digital currency bandwagon. Utilisation of Chinese DCEP could also aid the process of internationalising the Chinese Yuan (RMB).