Trent Hazard Writes

@TrentHazard

Writer. Futurist. Analyst. Developer of intelligence systems and processes. Lives at the intersection of technology, security, and very bad intentions.

https://trenthazardwrites.com @TrentHazard Guestbook

China's DCEP and Privacy

Blockchain and cryptocurrency systems can be configured to maximize anonymity or to serve as highly effective surveillance systems. Activists seek the former while governments are quickly realizing the potential for control that centralized and managed systems could offer. China, not surprisingly, isn't going to pass up this opportunity to surveil even more of it's citizens financial transaction. They appear to be close to launching their digital currency electronic payment (DCEP) system:

"Goodbye, cash ...The report also reiterates that the PBOC means for DCEP to be a direct replacement for physical cash.

In fact, Chinese banknotes and coins are already quickly being replaced by mobile payments, particularly via Alipay and WeChat Pay, the QR-code-based apps that have become ubiquitous in the span of just a few years. It’s been estimated that mobile payments made up more than 80% of all payments in China in 2018, up from less than 20% in 2013.

...goodbye, privacy? Mu Changchun, the head of the PBOC’s digital currency research institute, has said the DCEP will be compatible with Alipay and WeChat Pay. He also said it can be used without an internet connection. Some of the biggest questions pertain to privacy and anonymity, and how much access the government will have to transaction information. The new report from Caijing repeats something Mu has also said before: that the DCEP will offer users at least some degree of “anonymity.” It does not, however, explain how that might work."

Some degree of "anonymity" might mean that Chinese citizens will be able shield transactions from their neighbors but it will never, absolutely never, free them from complete government surveillance of each and every transaction. China isn't surging into this space to advance libertarian ideals, bank the un-banked, smash monopolistic control of financial channels, and maximize efficiency. Cash, not crypto, will be the ultimate refuge for privacy advocates - at least as long as it is allowed to exist.

For what it's worth, I am deeply familiar with the models in this space that seek to shield users from surveillance but I think they're either doomed to outright failure or limited (and quite risky) adoption. 


You'll only receive email when Trent Hazard Writes publishes a new post

More from Trent Hazard Writes: