To compete with China’s digital RMB, the US must embrace privacy-focused cryptocurrencies
Avichal Garg, co-founder and managing partner of Electric Capital, is convinced that the US has only one way to recover its disadvantage in the digital currency war against China, to embrace privacy-centric cryptocurrencies.
In a recent interview with Cointelegraph, Garg said that China is already far ahead of the US in the digital currency race. China’s DCEP, or Digital Currency Electronic Payment, will be launched before the end of the year. Therefore, a digital US dollar may Bitcoin Loophole app not be enough to compete, given the long period of time needed for its development:
„The Chinese system will be on the market for 5-10 years before the US launches an alternative.
Instead of developing its own product, Garg continues, the US government should support existing stablecoin projects based on the USD, such as the USDT.
By lightening the regulations related to these stablecoins, US dollar-based assets that fall under US jurisdiction, the US will be able to use them as a proxy to compete with China in the digital asset market:
„Within the next 12-24 months, I believe they could virtually give the green light to all these hybrid crypto-dollars.
However, Garg is convinced that the US is likely to be defeated if it competes with China on the purely technological front. Ultimately, in order to gain a competitive advantage, the US must provide what an authoritarian regime like China cannot offer – privacy-centric, censorship-resistant digital currencies.
To do so, the US should join forces with the crypto community and strengthen crypto-currency networks that represent democratic values:
„The best way for the US to compete is to embrace the best features of cryptocurrency and really promote them as a kind of attack tool against China.