Crypto Yuan: Recently, the Bank of China has been experimenting with SIM card payments.
Specifically, this week, Bank of China launched a new experiment with the Crypto Yuan, enabling payments through its SIM card using NFC technology.
Let’s take a look at all the details below.
Summary
Crypto experiment: Bank of China proposes SIM card payments
In recent years, China has stepped up experiments around the digital yuan (e-CNY), and the latest innovation involves payments made via SIM card.
This innovation is the result of a collaboration between Bank of China, China Telecom and China Unicom and is based on the use of Near Field Communication (NFC) technology for payments.
In other words, the same technology is used for contactless payments with bank cards.
At the heart of this solution is a “super NFC SIM card” that enables payment through the phone by simply bringing it closer to a payment terminal. However, this method offers advantages that conventional mobile payments do not.
Indeed, there is no need to open an app to make a purchase and it works even when the phone is offline or turned off.
Currently, this new feature is being launched as a pilot project, and is only compatible with Android smartphones that have NFC functionality.
Moreover, the use cases of this “Super SIM” could go beyond digital yuan payments.
In fact, the Bank of China explains that this technology could be tested in areas such as digital identity, access controls, and even opening vehicles to replace keys.
Will China cooperate with the United States on AI regulation?
During a recent discussion, Elon Musk reiterated the crucial importance of regulating general artificial intelligence (AGI) and its impact on human history.Â
He also highlighted the need for careful regulation to address the associated potential risks.
Surprisingly, China has expressed willingness to collaborate with the United States on AI regulation. But how might this unexpected alliance affect the global AI landscape?
Contrary to common expectations, Elon Musk revealed that China is open to collaborating with the United States and other countries on AI regulation.
This openness creates opportunities for constructive engagement, despite existing tensions between the two nations.
Musk drew parallels with the regulation of nuclear technology, stressing the importance of managing AI development responsibly.
Indeed, during a Twitter discussion, Musk was joined by US Representative Ro Khanna, who stressed the importance of getting expert guidance within Congress to understand AI.
Both experts acknowledged the delicate balance between regulation and innovation, with Musk warning about the risk of stifling AI progress, advocating instead for informational oversight.
In addition, Musk expressed concern about achieving an appropriate balance between regulation and promoting innovation.
He pointed out that excessive regulation could hold back the United States as China advances in AI development.
To address this problem, Musk proposed a sequential approach of obtaining valuable information through industry collaboration and then implementing the necessary oversight measures.
The CEO of Circle on the best option for China between Stablecoin or CBDC
China started testing its CBDC in April 2020, initially focusing on four cities: Chengdu, Shenzhen, Suzhou, and Xiongan.Â
Subsequently, the test program for the digital yuan expanded to other cities and also reached the country’s five largest regions.
Since then, the e-yuan or e-CNY, as China’s CBDC is also called, has seen significant adoption due to China’s efforts in promoting its use.
However, the CEO of Circle, Jeremy Allaire, recently expressed the view that China needs a Yuan-backed stablecoin rather than a central bank digital currency.
As we know, Circle is a cryptocurrency company responsible for the USDC stablecoin, which is pegged to the US dollar.
During an interview with the South China Morning Post, Allaire suggested that a stablecoin could be more effective than a CBDC in promoting the use of the RMB (Renminbi, the Chinese currency) in international trade.
According to Allaire, the use of a stablecoin linked to the CNH (Chinese Offshore Yuan) would increase the use of the currency in trade transactions globally.
However, Allaire also noted that mainland China may be reluctant to adopt the entire cryptocurrency industry, making it difficult to implement his proposals.
Regarding the full adoption of digital assets in Hong Kong, Allaire said that in order to remain relevant, the city needs to follow the example of other major financial markets in the world that are adopting digital assets, including taking into consideration large financial institutions.
Allaire also discussed the future of stablecoins once many countries launch a digital central bank currency. According to the CEO, private stablecoins are driving innovation, while CBDCs are simply complementary.
