Dan Andersson: China's Cash Crisis Might Be Creating Digital Opportunities

Dan Andersson, CEO & President at Learning Enterprises Organisation Ltd and LEOcoin, discussed how China's recent crisis might be creating opportunities for digital currencies, in a blog post as published on Huffingtonpost.

He noted that China's exports have decreased by more than 8 percent and the yuan is down 27 percent on June. "Thus far the CPC have been unable to halt the slide", he added.

However, based on his own experience in the country, he thinks that the decline will only be temporary even if the longer term consequence for the political establishment might be more permanent.

Elaborating on the significance of digital currency he said that it offers an opportunity for "instant international, secure, private trading outside of punitive international charges and regulation".

Replying to his own question that if digital cash could help a business during an economic slowdown/recession and whether that in itself could help to shorten the downturn by keeping the economy moving, he said, "Digital currencies like ours and Bitcoin, for example, are already seeing an increase in trades in light of the falling Yuan, as I discussed in my last piece, Greece has seen similar activity. Where the traditional banking system in Greece failed, individuals turned to Bitcoin to escape the restrictions that came from capital controls. In China Bitcoin has suffered from bad press (and the government continues to try to restrict its use), but this has not hampered widespread adoption of the currency; mining and exchange of Bitcoin continues to happen on an immense scale within the country."

He added, "So is it feasible to think that Bitcoin could provide a viable alternative to fiat currency in times of financial crisis? Could digital currency be a vital key to unlock growth for businesses, an avenue for them to keep trading with other businesses both at home and abroad as the state crumbles around them? The fact that a digital currency, like LEOcoin, is 'stateless' could be the key factor allowing a business to keep trading without the need to interact with government or a bank even - perhaps this is why we have so many users in China?"

He concluded stating that people are looking to currencies whose value lies with the community who use it, rather than a nation state; that is perhaps the true vision of globalisation.