The United States is losing the “Technological Cold War” to China because of its strict regulatory approach to blockchain and cryptocurrency companies., believes a top Ripple manager.
Chris Larsen, co-founder and chairman of major crypto payment firm Ripple, made a statement for The Hill on Aug. 21. He said China’s digital currency leadership has “once a century an opportunity” to replace the US dollar with the digital yuan as the world’s reserve currency.
Larsen set out the main reasons China defeated the United States in the ongoing technological struggle. This means, China “has already achieved near universal use of digital payments” through technology giants like Alipay and WeChat.
And while China is “on the verge of” issuing its own central bank digital currency, the digital yuan, the United States still lacks an official initiative for the digital dollar, noted Larsen, adding:
“At least 65 percent of cryptocurrency mining is concentrated in China. This means that the Chinese government has the majority needed to exercise control over these protocols and can effectively block or reverse transactions.”
Larsen also mentioned expanding security from China to Hong Kong, stating that C.hina is now “the only country in the world that controls two global financial centers”.
To challenge China’s crypto and technology leadership, The United States “must recognize that strong US fintech companies” are in their own national security interestsLarsen closed.
The executive said that The United States must start the Digital Dollar Initiative immediately to keep up with the digital yuan. The next step is to establish Silicon Valley as a global financial technology powerhouse.
Larsen’s comments are found amid the current regulatory uncertainty surrounding XRP. The third largest cryptocurrency by market capitalization, XRP, is used by Ripple in cross-border applications such as on-demand liquidity (formerly xRapid).
On August 20th, Brad Garlinghouse, CEO of Ripple, emphasized that the biggest challenge Ripple has faced so far is the lack of clarity about the regulatory status of XRP. The cryptocurrency project and Ripple are subject to multiple lawsuits alleging that XRP is an unregistered security.