Comparison of Attitudes and Policies between China and the United States in the Crypto Assets Field

Recently, the United States and China have shown vastly different attitudes and policy directions in the field of Crypto Assets. U.S. President Trump signed an executive order aimed at promoting the development of U.S. encryption and considering the establishment of a national digital asset reserve. Meanwhile, China is actively advancing the development and application of central bank digital currency (CBDC).

US Crypto Assets Policy

The executive order signed by Trump emphasizes the importance of the digital assets industry for innovation, economic development, and international leadership in the United States. The main contents of the order include:

1. Establish a working group to consider the establishment of a national digital asset reserve
2. Protect individuals and private enterprises using blockchain networks
3. Provide certain protective measures for developers and miners
4. Defend the right to personally custody digital assets
5. Support the development of globally legitimate, USD-backed stablecoins.

However, the order also prohibits the establishment, issuance, circulation, and use of Central Bank Digital Currency (CBDC) in the United States. This decision reflects the Republican Party’s general skepticism towards government intervention in the financial industry.

China’s Digital Currency Strategy

In contrast, China has made significant progress in central bank digital currency:

1. As of July 2024, the electronic Renminbi application has attracted 180 million individual wallet users, with a cumulative transaction volume of 7.3 trillion yuan in pilot areas.

2. China actively participates in the mBridge project, which aims to explore a multi-central bank digital currency platform for instant cross-border payments and settlements.

3. The policy document jointly issued by the People’s Bank of China and four other departments provides an opportunity for the potential development of the Crypto Assets industry.

However, China also faces some challenges in promoting the digital renminbi, such as issues with the incentive mechanisms for payment institutions and low consumer acceptance.

Global CBDC Development Trends

According to a report by Reuters, 134 countries are currently exploring digital versions of their national currencies, accounting for 98% of the global economy. Nearly half of these countries are in the later stages of this process. Research by the Atlantic Council think tank in the United States shows that all G20 countries are studying CBDCs, with a total of 44 countries currently in the trial phase.

Expert Opinions

Wang Yongli, former vice president of the Bank of China, believes that Bitcoin highly mimics gold on the “coin” level, but its total supply limit prevents it from growing in line with the increase in the value of tradable wealth, which does not meet the essential requirements of currency.

Zhou Xiaochuan, Vice Chairman of the Boao Forum for Asia and former Governor of the People’s Bank of China, warned that the impact of digital crypto assets on global financial stability and financial security needs to be taken seriously.

Peking University scholar Dong Zhiyong suggested that in order to promote the digital renminbi, a reasonable charging mechanism should be established, and value-added services should be explored in collaboration with payment institutions. At the same time, he also recommended creating an ecosystem for industrial and commercial use cases.

Overall, China and the United States have adopted different strategies in the field of Crypto Assets and digital currencies. The United States tends to support the development of private sector Crypto Assets, while China actively promotes state-led digital currency projects. This policy divergence may have far-reaching implications for the global financial landscape.