CHINA - Digital Currency New Tool for Global Dominance

Arno Froese

Even as China grows in economic and military power, perhaps nothing reveals Beijing’s weaknesses more than the U.S.’s control of the global financial system. China has recently sought ways to counteract U.S. sanctions after the Trump administration targeted Chinese officials and companies over policies from the South China Sea to Xinjiang.

[…] Challenging U.S. dollar dominance and neutralizing sanctions, the digital yuan appears potentially more geopolitically significant as leverage over multinational companies and governments that want access to China’s 1.4 billion consumers. Since China has the ability to monitor transactions involving the digital currency, it may be easier to retaliate against anyone who rebuffs Beijing on sensitive issues like Taiwan, Xinjiang and Hong Kong.

So far China has mostly resisted hitting foreign firms in response to U.S. actions on companies like Huawei, holding off on releasing an “unreliable entity list” designed to punish anyone who damages national security. Any move to cut off access to the digital yuan would carry similarly high stakes, potentially prompting foreign investors to pack up and leave.

China’s ability to see every transaction may make it difficult for foreign banks to use the digital yuan and still comply with confidentiality rules in their home countries, according to Emily Jin, a research assistant at the Center for a New American Security. But, she added, the currency might appeal to some regimes that prioritize control over privacy protection.

Any serious challenge to the dollar’s position as the world’s reserve currency would also require significant policy changes from China, including lifting capital controls that help the Communist Party keep a lid on sudden outflows that could trigger a financial crisis. Even if the digital yuan could be transacted more cheaply outside of U.S.-controlled global payment systems, it’s unclear if anyone would use it.

China began research on the digital yuan back in 2014, right after the price of Bitcoin surged from $13.40 to more than $1,000, raising the risk that digital currencies could impact Beijing’s control of monetary policy. It has begun technical testing with Hong Kong for cross-border payments, and is working with Thailand and the United Arab Emirates on real-time foreign exchange settlements. Authorities are also studying how the digital yuan can be combined with 5G networks and the internet of things.

This kind of research allows China a greater say in how other countries across the globe design digital currencies, particularly when it comes to questions of surveillance, privacy and anonymity, according to Josh Lipsky, director of the Atlantic Council’s GeoEconomics Center., 21 April 2021

Arno's Commentary

China is relentless in its pursuit to replace the US dollar. Most experts in this field see little to no chance of that to occur. After all, the Chinese currency only makes up about 2% of global foreign exchange, compared with nearly 60% for the US dollar. However, the potential for a significant increase in usage of Chinese currency, and at the same time, a significant US dollar decrease is not out of the question in the long run. 

We learn from Revelation 18 that the end-time system is global. Subsequently, either a global world reserve currency will be established, or other currencies will become on par with the US dollar. Nevertheless, in the end, what is written in Revelation 17:12-13 will be fulfilled: “And the ten horns which thou sawest are ten kings, which have received no kingdom as yet; but receive power as kings one hour with the beast. These have one mind, and shall give their power and strength unto the beast.” Who are these kings? Obviously, they are diabolical entities, because the next verse clearly identifies them as non-earthly, “These shall make war with the Lamb, and the Lamb shall overcome them.” There is no power structure on earth that can challenge the Lamb of God. Why? Because He is not an earthly, physical identity, and thus not subject to physical opposition from planes, guns, bombs, tanks, or even nuclear weapons. 

Who is this woman? Revelation 17:18 answers: “And the woman which thou sawest is that great city, which reigneth over the kings of the earth.” What is this “great city?”

Arno Froese is the executive director of Midnight Call Ministries and editor-in-chief of the acclaimed prophetic magazines Midnight Call and News From Israel. He has authored a number of well-received books, and has sponsored many prophecy conferences in the U.S., Canada, and Israel. His extensive travels have contributed to his keen insight into Bible prophecy, as he sees it from an international perspective.

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