An economic and financial historian in the United Kingdom, Niall Ferguson has stated that the United States needs to develop its own path where cryptocurrency adoption is concerned. As such, he said that it wasn’t possible for the world’s biggest economy to develop its own versions of the electronic payment systems that have already been developed by China. This strange stance made its way to an opinion piece on Bloomberg on Sunday. According to Ferguson, this ongoing coronavirus pandemic had brought about a small silver-lining for the crypto space because it had accelerated its global adoption to a significant extent.
In turn, this had resulted in a somewhat global monetary revolution as per Ferguson, but the historian couldn’t help but shed some light on the rapid progress made by China in this regard. Digital payments are on the rise in the country and it is already moving towards the rollout stage of its central bank digital currency (CBDC) i.e. the digital yuan. The China-based payment apps, Alipay and WeChat Pay are reportedly handling nearly $40 trillion in transactions annually. Therefore, Ferguson is convinced that measures taken by China will serve as a template for a number of other countries in the development of cross-border payment systems and remittance payments.
Even so, the historian went on to say that this template was not a suitable one for the United States. He went on to say that countries all around the globe were working on their respective versions of electronic payment systems that had been developed by China. Ferguson said that this was also applicable to governments that were resisting the financial penetration by China, one of the prominent examples being India. Consequently, Ferguson was not in favor of developing a digital dollar in a ‘Chinese style’ and urged the upcoming Biden administration to understand the benefits that could be enjoyed with Bitcoin’s integration into the US financial system.
The historian asserted that there are already ways that can be used by the US authorities for Bitcoin enforcement. The Internal Revenue Service (IRS) has now mandated all individuals to declare their crypto holdings when filing their tax returns. However, not all hiccups have been eliminated, as miscommunication over the tax returns of crypto exchange Coinbase prompted the IRS to pursue its users. The Federal Bureau of Investigation (FBI) has also shifted its focus towards cryptocurrencies, as they are keeping track of money laundering cases in the industry.
The key argument that Ferguson made in Bitcoin’s favor was that the leading cryptocurrency was more capable of protecting the financial data of all law-abiding citizens, better than apps such as Alipay could do. As far as President-elect Joe Biden’s view on cryptocurrencies are concerned, which includes Bitcoin and central bank digital currencies (CBDCs), he hasn’t expressed his views. Even so, there have been hints that the administration is more open to cryptocurrencies and could develop a regulatory framework for the crypto space in the country, which would be a lot more hospitable than the current situation.