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Digital currency will replace banknotes in the future

Author:Hubi Date:2018-07-25 14:58:48

At present, when it comes to digital currency, it seems to give people a sense of illusion. So, what is digital currency in the end? What are the characteristics of the blockchain technology behind it? Will digital currencies become a trend?


The so-called digital currency refers to the alternative currency in the form of electronic money. Both digital gold and password currencies are digital currencies, but they cannot be completely equivalent to virtual currencies in the virtual world because they are often used for real goods and services transactions, not just in virtual spaces such as online games.


At present, the currency is issued by the government in most countries in the world. It is reported that there are currently thousands of digital currencies distributed worldwide, of which, digital currencies such as Bitcoin are more rapidly developed in recent years.


“There will be no banknotes in the future,” Huang Zhen, director of the Institute of Financial Law at the Central University of Finance and Economics, said in an interview with the media that the central bank’s latest statement conveyed a signal that digitization is a trend and that the future currency will be digitized.


The current mainstream economic theory holds that the government has the responsibility to adjust monetary policy accordingly in accordance with the economic situation. Therefore, this intermediate contradiction is a key issue that the relevant departments must solve when implementing digital currency.


The expert explained that the essence of finance is credit. In a sense, the significance of financial institutions is to solve credit problems.


For example, the third payment, if the parties to the transaction trust each other, why need this intermediary? A revolutionary breakthrough in blockchain technology is trust. That is, two arbitrary nodes in the network (which can be understood as any two persons) can accomplish value transfer accurately and fairly without mutual trust, such as transfer. Neither party has the ability to tamper with data or manipulate transactions.