Zhu Jiaming: The central government advocates blockchain and incorporates scientific and technological elements into the concept of governing the country. Its historical significance cannot be underestimated.

Author: Wang Feng Ten Questions

Source: Mars Finance

Editor's Note: The original title is "The Economist Zhu Jiaming is a guest of Wang Feng. Ten questions: The central government advocates blockchain, and incorporates scientific and technological elements into the concept of governing the country. Its historical significance cannot be underestimated."

This article is intended to convey more market information and does not constitute any investment advice.

At 2 o'clock on the afternoon of November 4, Wang Feng, who had not seen for a long time, asked for another "fire". Around the current hot blockchain wave and deep thinking behind it, Zhu Jiaming, the economist of the first peak dialogue.

Zhu Jiaming is a famous economist in China. He was the main initiator of the Moganshan Conference in 1984. He was an economist at the United Nations Industrial Development Organization and taught at the University of Vienna and Taiwan University. His representative works include "The Structure of National Economic Structure". "From Freedom to Monopoly: China's Monetary Economy for Two Thousand Years" and "Libra: A Financial Innovation Experiment". Since 2012, Zhu Jiaming has focused on the research of digital economy, digital assets and digital currency, and has created many systematic ideas and new theoretical systems. It is a pioneer of economic thinking in the field. At the same time, the Digital Assets Research Institute, founded by Zhu Jiaming, organized a conference and research on “blockchain” and mathematics, economics, law, and quantum science. As far as possible, the blockchain research science and professional deep structure were combined. And created an independent project with advanced meaning.

In the dialogue, Wang Feng successively threw out a series of sharp questions: Why did the central government strongly advocate blockchain at this stage? How to redefine digital currency? How to treat the current government's increasingly specific and specialized in the field of technological innovation? How do you view the new opportunities brought by China's development of the central bank's digital currency for the internationalization of the renminbi?

Zhu Jiaming expressed his expectation for the development of China's blockchain industry among the lines. He believes that in the traditional global financial market, it is quite difficult for China to achieve “big overtaking” in competition, but the blockchain creates a “new financial market” parallel to the traditional global financial market, although the new financial market is still small and fragile. The stage, but its potential and growth rate is extremely fast.

"With the development and development of this market, China is likely to become a frontrunner, even affecting the formulation of rules, having a first-mover advantage in the competition, and eventually becoming a winner in the new financial field."

In response to Wang Feng’s reference to the status quo of “blockchain technology and innovation is ahead of supervision”, Zhu Jiaming clearly mentioned that this involves many aspects such as upgrading traditional laws, achieving technical aspects, and coordinating international cooperation. “At the end of the day, the problem that needs to be addressed is the fundamental challenges that the digital economy, digital assets and digital currencies pose to existing legal and legal systems.”

As a well-known economist, Professor Zhu Jiaming has great reference value for the judgment of the current blockchain industry. The following is the original dialogue:

“The central government advocates the release of four important signals from the blockchain”

Wang Feng: First question, I saw the news of the 18th collective study on the status quo and trend of blockchain technology development on October 24th by the Political Bureau of the CPC Central Committee. My colleague and I were surprised by the first reaction. I suspect a lot. People and I have similar feelings – almost unbelievable. After all, many people who have been engaged in the application and investment of blockchain technology have been controversial. Some government officials and mainstream business elites have also avoided the three words of the blockchain. Inadequately, the community’s perception of the blockchain is also thousands of people. As an economist, I have done a lot of work on digital asset research in recent years. What is your first feeling after hearing this news?

Zhu Jiaming: On the evening of October 25, I was on the road. When I knew the news, I didn't feel so surprised. Rather, my rationality immediately overwhelm and suppresses any emotional and emotional natural reactions. Reason drives me to think about two basic questions: First, why is it a "blockchain"? Second, why is it October 25 this year, and just before the Fourth Plenary Session. Of course, I am not able to answer my own questions.

Wang Feng: Both CCTV and the People's Daily have given large-scale coverage of this speech in the first time, setting off a blockchain boom across the country. Why do you think the central government has begun to vigorously promote blockchain at this stage? What signals can we resolve from?

Zhu Jiaming: First you need to define the words "this stage". I believe that "this stage" mainly refers to China's "post-high-speed growth" stage, that is, the historical stage in which economic growth has entered the 6% to 7% range. At this stage, "innovation" needs to be the core driving force for China's economic growth. However, the technical field involved in "innovation" is extremely broad, and it is necessary to find a technology with comprehensive characteristics, or the technology itself is a "cluster", or a "collection" of various high-tech. There is no doubt that only the "blockchain" has such a feature.

As for how to answer the "resolved" which signals? Different people, in different backgrounds, naturally have different opinions. From my perspective, the most important signals include these:

First, because the “blockchain” concentrates on technologies in mathematics, cryptography, computer science, artificial intelligence, big data, and the technological achievements of the Internet for many years, it is necessary to re-evaluate the science and technology of “blockchain”. value;

Second, the potential of the “blockchain” needs to be fully explored, and it has not been fully explored at present;

Third, it is necessary to expand the application scenario of “blockchain”, not only in the economic field, but also in the political and social fields.

Fourth, choose the time before the Fourth Plenary Session to provide the block space technology and the imagination space to improve the social governance model.

It should also be noted that the news of the 18th collective study on the status quo and trends of blockchain technology development on October 24th by the Political Bureau of the CPC Central Committee far exceeds the value of news and reflects a strategic shift in the decision-making level. That is to incorporate the elements of science and technology into the concept of governance, and occupy an unprecedented important position. This is unprecedented since the founding of the People's Republic of China, and its historical significance cannot be underestimated.

Wang Feng: The Third Plenary Session of the Eleventh Central Committee of the Party, held in December 1978, opened the great course of China's reform and opening up. Now that 41 years have passed, what kind of mood do you think when you first heard China’s policy of reform and opening up?

Zhu Jiaming : In December 1978, I just graduated from the postgraduate program for three months. Our classmates listened to the announcement of the Third Plenary Session of the Eleventh Central Committee in the dormitory. At that time, everyone was very excited, not only because the Cultural Revolution officially ended, but also ended the long-term stagnation of the national economy, but felt that China would complete the fundamental changes in the social system and economic system.

Wang Feng: I have seen your information. At that time, it seems that you are only 28 years old. It is similar to the age of today's 90s and only worked for a few years. As an intellectual who experienced reforms in the past, you have made suggestions for China's economic reform. Are you still willing to talk about how you have smashed the future of China's economy? Compared to today's political and economic environment, how do you view the fundamental difference between today and yesterday?

Zhu Jiaming : Our embarrassment of the Chinese economy at that time was quite simple. I hope that China will solve the problem of universal poverty in a limited time and need reform. As for China's future model, the most talked about is the Asian Tigers. It was a historical period of long-term “closed lock”, and our understanding of the world was very limited. There were almost no friends and relatives who went abroad. Therefore, the so-called "憧憬" imagination has great limitations.

Wang Feng: Give me a personal impression. Today, more than 40 years after the reform and opening up, the central leadership has paid more and more attention to the study of technology. In the past three years, the Politburo, which involves the country's major science and technology innovation strategy, has only one study each year, namely the 2017 National Big Data Strategy, the 2018 Artificial Intelligence, and the recent blockchain technology. In the early days, I noticed that the central leadership has more talks about technology learning. For example, Deng Xiaoping once mentioned “the first productivity of science and technology”, Jiang Zemin proposed to implement the strategy of “rejuvenating the country through science and education”. Relatively speaking, the current central government is in technology. Focused learning in the field of innovation is becoming more specific and specialized. How do you view this phenomenon?

Zhu Jiaming : Good thing. This is a historical trend. In the near future, professional politicians will gradually be eliminated globally. That is to say, politicians need not only to understand the economy, but also to understand science and technology. Because science and technology will increasingly affect economic life and political life.

“The blockchain has created a 'new financial market' and China is expected to be the ultimate winner”

Wang Feng: Second question, we will return to the innovation of blockchain technology. Innovation promotes social progress and leads to the redistribution of social wealth. I believe that the information technology provided by Internet technology, such as small companies and groups can easily register a WAN domain name website and carry out legitimate information services, which was unimaginable in the early days of reform and opening up.

The development of new technologies is becoming more and more beneficial to start-up companies. The Internet innovation and entrepreneurship in the past two decades has comprehensively promoted the overall level of China's informatization, and has also allowed some people engaged in Internet services to obtain sufficient wealth, and today's districts Is there a great possibility of blockchain technology that will accelerate the process of financial democratization and create a new era?

Zhu Jiaming : The "new era" is a big concept that requires too many historical conditions. Therefore, I am not able to answer whether the "blockchain" technology can create a "new era." However, blockchain technology will speed up the process of financial inversion, and there should be no doubt.

Wang Feng: The beginning of the boom, fully embracing the blockchain technology, can China win a big overtaking opportunity in the global financial market competition? To this end, what do you think China should do?

Zhu Jiaming : At present, the competition in the world financial market is divided into two major types: First, the traditional global financial market. In this market, China still hopes to gain an advantage in the competition and achieve "big overtaking" is still quite difficult. For example, in this market, in the foreseeable future, dollar hegemony still exists, and the unreasonable state of world financial resources is difficult to change.

Second, the new financial market. Because the blockchain creates a “new financial market” parallel to traditional global financial markets. Although the “new financial market” is still in a small and fragile stage, its potential and growth rate are extremely fast. With the development and development of this market, China is likely to become a frontrunner, even affecting the formulation of rules, having a first-mover advantage in the competition, and eventually becoming a winner in the new financial field.

As for China’s biggest preparations, what should it be? My answer is talent, talent, and talent.

Wang Feng: Previously, even now, many people still put together new technical vocabulary such as blockchain, big data, Internet of Things, cloud computing and artificial intelligence. In my opinion, big data and cloud computing are the natural recursion of the Internet to a stage that is powerful. However, blockchain, Internet of Things, and artificial intelligence need to be fundamentally improved, and there is a long technology to explore in the dark, whether it is algorithmic computing or generalized standard protocols, each has its own problems. In your opinion, if only from the perspective of economics, the innovative significance of blockchain technology, compared with the other in the above technical vocabulary, what is the difference? It has been said that blockchain technology can be likened to a technology that reshapes production relations.

Zhu Jiaming : I have already said before: "Blockchain" is a cluster concept that naturally includes big data, cloud computing and artificial intelligence. As for the "Internet of Things", it is a kind of utilization of the blockchain.

The argument that blockchain technology reshapes the "production relationship." "Production relationship" is an important concept of historical materialism, corresponding to "productivity." The "blockchain" not only involves social economic organizations, social systems, but even changes such as "enterprise" and "company" organizations, and not the words "production relations" can be summarized. Borrowing the concept of historical materialism, the “blockchain” itself is also a unique productivity.

I especially want to emphasize here: although the blockchain principle and technology have a long history, they are still in a fairly early stage. The potential and tension of the blockchain is still huge. It changes not only the financial ecology, but the all-round social system. It provides unprecedented technology for people to think and discuss for many years, and the “big transformation” that the contemporary world is experiencing. Tools, even infrastructure.

“The blockchain will lead to the emergence of new financial sectors and promote the overall progress of the financial industry”

Wang Feng: The third question is that in the major technological breakthroughs in human history, whether it is steam engines, electricity, or atomic energy, computers, space technology and bioengineering, most of the technologies solve the problem of efficiency, and even humans have applied the technology to solve the problem. The exploration of time and space, for example, some people are already exploring eternal life and the next life space, but looking back, there is never a technology that specifically solves the credit problem, and the emergence of blockchain technology comes into being.

The past credit endorsements of human beings are often derived from the financial and military power of the national government, and at least the size of large commercial organizations to determine credit.

However, Bitcoin acquired such a credit with a set of algorithms and papers.

Blockchain technology combines distributed storage, peer-to-peer communication, cryptography and consensus mechanisms, spanning many disciplines such as computer science, cryptography and sociology. As an advocate of interdisciplinary thinking, when did you notice the ability of the blockchain to solve credit problems? What kind of application will this technology around credit generate? What are the toughest problems at the moment?

Zhu Jiaming : When Bitcoin was born, I taught at the University of Vienna. One of the courses is “Currency History” and Bitcoin is naturally included in the course. Talking about bitcoin, I have to talk about blockchain.

Bitcoin begins with a "point" to "point" payment model, based on the technical mutual trust mechanism and the "consensus algorithm" and "smart contract" that support the mutual trust mechanism. In other words, because of the “consensus algorithm” and “smart contract”, the “blockchain” can implement the credit system.

In theory, the application range of "blockchain" is infinite. Therefore, the application scenario of the blockchain is not of much value. Human economic activities, both ancient and modern, are inseparable from the market, and the basis of market behavior is credit. Therefore, today, any technology combined with credit is conducive to the evolution of the market economy, enriching the way of human economic activities, and naturally has an infinitely broad application space.

Wang Feng: Credit is the foundation of financial activities. The financial industry is the crown of global economic competition. The impact of the blockchain on the financial industry will be greater and greater, and the change will become more and more obvious, although many people are still numb. There is a saying that I really like, "The blockchain is rewriting the old financial system. "This is a phrase that an entrepreneur who is doing DeFi (Distributed Financial Services) abroad told me. After the credit was rewritten by technical algorithm technology, the innovation of the blockchain in the financial field is very active.

From a technical point of view, how much blockchain technology will lead to the opening up of the financial industry? For example, a commercial organization can use the blockchain technology to issue digital assets without going through the traditional approval process. In the Ethereum world alone, there have been a large number of DeFi applications, such as decentralized lending services.

Zhu Jiaming : For the financial industry, blockchain technology is not just an “open” issue. More importantly, blockchain technology will lead to the emergence of new financial sectors and promote the overall progress of the financial industry.

Wang Feng: As the founder of the Digital Assets Research Institute and the director of the Academic and Technical Committee, can you briefly tell us about the background of the establishment of the Digital Assets Research Institute? What research and analysis did the Digital Assets Institute do? We hope to hear more about your thinking and analysis.

Zhu Jiaming : The establishment of the Digital Assets Institute was not long, it was in the spring of 2018. However, the time of the Digital Assets Institute's brewing and informal operation can be traced back to 2012, when the founders of the Institute participated in bitcoin research, published bitcoin monographs, and taught digital currency courses at Taiwan University and Feng Chia University. And through the Taiwan Yangmingshan Future School to promote the "blockchain."

After the establishment of the institute, three main types of work were done: First, the expansion of academic thinking. Organized a "blockchain" and related meetings on mathematics, economics, law, and quantum science, and as far as possible, the deep integration of blockchain research science and professionalism; second, the creation of independent projects with advanced significance. For example, the time bank under development, the ASEAN countries stabilize the currency. Third, explore the direction and trend of medium and long-term development of blockchain.

Zhu Jiaming first talks about the relationship between the central bank's digital currency and the "public chain"

Wang Feng: Fourth question, let's talk about digital currency directly. This is the focus of many people on the topic. Although there are technical officials from the central bank and some senior government officials, I think the current digital currency is still relatively sensitive. We are here to do academic discussion and enlightenment. Many people mentioned that digital currency is often understood to be bitcoin, but in fact, as the central bank's digital currency and Libra's voice became more and more like, the public began to notice that the same "digital currency" had this difference.

In the past few months, Libra and the central bank digital currency (DCEP) have become the focus of public opinion, and the Sino-US digital currency war seems to be coming. On October 28, Huang Qifan, deputy director of the former National People's Congress Financial and Economic Committee and vice chairman of the China International Economic Exchange Center, said that the current research on the central bank's digital currency (DCEP) has been mature for five or six years, and the People's Bank of China is very Probably the world's first central bank to introduce digital currency.

What do you think are the factors for the country to introduce the central bank digital currency in the current stage?

Zhu Jiaming : This question is difficult to answer in this question, but it is still possible to envisage the main factors that may affect the central bank's digital currency team:

First, some overseas countries have discussed and practiced the central bank's digital currency.

Second, domestic demand for central bank digital currency. After September 2017, when the ecology of China's domestic digital currency has undergone great changes, when the private digital currency window is basically closed, the pressure on the digital currency of the central bank is increasing.

Third, various types of stable coins such as Libra, IBM, and USDT come out, which poses considerable challenges to the central bank's digital currency team and provide reference experience at the technical and experimental levels.

Fourth, the bigger question is how to further internationalize the Chinese renminbi and change the pattern of traditional renminbi internationalization, which requires the central bank's digital currency.

Wang Feng: Suppose we narrowly understand the digital currency that anchors the country's legal currency as the stable currency referred to by the current technology circle. Countries are creating digital currency based on national legal currency. One is the Libra monetary system launched by Facebook, a large commercial Internet company in the United States. The other is the digital currency of the National Central Bank of China, which is already on the table of the global digital currency market.

Both currencies are considered stable currencies that anchor national currency. Although Libra proposes to anchor a basket of multi-national legal currency, in the end, people are large commercial enterprises in the United States, and the US dollar will certainly occupy a very important proportion.

Can you disclose your research and compare the SWOT analysis of Libra's “Western Food” and DCEP “Chinese Food” in their respective product architecture design and international market competition opportunities. What is better or worse? Who wins and who loses?

In layman's terms, Libra's "Western food" and DCEP "Chinese food" are superior in product structure. Who wins and loses in the future international competition?

Zhu Jiaming : The product architecture of Libra and DCEP has different ideas from each other. Different architecture models make it difficult to compare who is better or worse. Further, Libra and DCEP are both in the conception phase and the experimental phase, and there is no real landing. Without a practice test, any comparison is too early. To take a step back, even if Libra and DCEP land, it will take a long time to decide who wins and who loses.

Wang Feng: Judging from the layout of the existing Internet between China and the United States, our difficulty is that we cannot get out. Their difficulty is that they cannot get in. Until today, there are few large Internet companies in China that have made significant progress in the globalization. Tencent and Alibaba are still leading in the payment, but they still have the advantage of the Chinese local market. Of course, the overseas version of Vibrato's TikTok is popular in the Indian and African markets, but compared to Facebook, Chinese companies are still struggling. In the past few decades, the proportion of RMB settlement in China's global trade has been negligible. The internationalization of the RMB has many obstacles and resistance. China must find effective new methods. How do you view the new opportunities brought by China's development of the central bank's digital currency to the internationalization of the renminbi?

Zhu Jiaming : The central bank's digitization of the renminbi will help in technological and institutional innovation in the internationalization of the renminbi. In the new form, it will bring new opportunities for the internationalization of the renminbi.

Wang Feng: The blockchain is different from the Internet. Take the public chain as an example. No public chain has any national boundaries, no matter the size. The Chinese public chain has developed communities, investors and users all over the world. Today's blockchain technology is far worse. The Internet industry is mature, but the public chain does not depend on cultural restrictions similar to the Internet. The public chain is born internationally.

Do you think that if we vigorously develop the blockchain, including the public chain and other ecosystems, is it conducive to promoting the popularization of the central bank's digital currency? I boldly speculate that purely fragmented technology-based, in the process of virtual assets in the public chain, will have an anchor relationship with the central bank's digital currency. A large number of blockchain digital assets may be more conducive to the renminbi's global roots?

Zhu Jiaming : The relationship between the central bank's digital currency and the “public chain” is quite complicated. In principle, if the “public chain” is further developed and the technology is further broken, it will help to satisfy the greater freedom of choice for the public chain, facilitate the promotion of the decentralized node model, and create a more popular for the central bank’s digital currency. Good premise. The central bank's issuance of digital currency requires a consensus among the people. This is a typical "public chain" feature. However, the centralization requirement of the central bank to issue digital currency is the characteristic of the private chain. In addition, the bank's hierarchical design must absorb some of the technologies and ideas of the alliance chain. Therefore, the blockchain of digital currency issued by the central bank is more like a A mixed blockchain, at least a "public chain" that needs to be redefined, has too many ways to go in terms of technology and practice.

Putting forward the use of the central bank's digital currency as an anchor and deriving virtual assets through the “public chain”, there seems to be a problem in logic: the digital currency issued by the central bank is the traditional sovereign currency of the central bank as an “anchor”. To be precise, it is sovereignty. The gold and foreign exchange reserves of the currency are "anchors". In other words, the current central bank digital currency itself needs to be “anchored”, so it is difficult to become an “anchor” of digital assets.

The blockchain that supports the flow of virtual assets may be a public chain, or a coalition chain and a private chain. If the virtual asset needs an "anchor", in the end, it should be equivalent to supporting the "anchor" of the digital currency. For the foreseeable future, a real value base is needed between virtual assets and digital currencies. For example, the digital currency of the People's Bank of China is actually a state of mind of the French currency, behind which is the value base of the traditional renminbi, such as the foreign exchange reserves that underpin the value base of the renminbi.

As for the increase and expansion of the blockchain digital currency, will it be conducive to the global landing and rooting of the renminbi, there is no necessary causal relationship between the two, because the renminbi’s global landing and rooting depends on too many factors, geopolitics It is one of them.

Wang Feng: Let's talk about another form of digital currency. It can be said that Bitcoin has enlightened digital currency. The interesting question is, can Bitcoin achieve the vision of the original world currency under the competition of Libra and the central bank's digital currency?

Zhu Jiaming : In today's world, the name of both the world currency and the real currency of the world currency has not yet been produced. Bitcoin has the name of the world currency, but it has no real world currency. The dollar has the real power of the world currency and plays the role of the world currency, but it is, after all, the sovereign currency of the United States. Why Bitcoin has the name of the world currency, but not the world currency, the root cause is that Bitcoin is too small.

Digital currency is still in its early stages, and the future digital currency world continues to be exploding and expanding. In the process of explosion and expansion, more digital currencies are added to it, which cannot change the way Bitcoin has and continues to be. status. Now, whether it is the central bank or Libra, it has not really gone to market, and competition has not yet taken place. Even if such competition occurs, it is difficult to influence Bitcoin to become larger or smaller, because Bitcoin has a unique position in the digital currency system.

“There are no clear boundaries between digital assets and digital currencies in the digital economy.”

Wang Feng: Fifth question, last Friday, October 31, 2019, was the 11th anniversary of the official launch of the Bitcoin white paper "Bitcoin: Peer-to-Peer Electronic Cash System". Bitcoin has achieved a lot of society in the past eleven years. I agree that some mainstream commercial organizations have also joined in. However, in view of the discussion we have just mentioned, once the country starts the digital legal currency DCEP, I think the word digital currency may need to be redefined. Part of it is that there is a great risk that the folks will engage in currency. For example, last year someone proposed to use the pass to replace it. (A translated version of Token), for example, in the mainstream political and business context of China's reality, is it timely to define Bitcoin as a “digital currency”?

Zhu Jiaming : In the traditional economy, there are clear boundaries between money and assets. However, in the digital economy, there is no clear boundary between digital assets and digital currencies. Specific to the digital currency world, Bitcoin represents the original digital currency. The significant difference between digital currency and traditional currency is that digital currency itself has the characteristics of digital assets, and is closer to Keynes's description of the functions of payment, speculation, and storage.

So how to define digital assets is not easy now, because the digital assets in real economic life are still developing and growing. However, the concept of traditional assets can be referenced and borrowed to define digital assets as a new type of wealth that can be value added and traded, including purely digital assets and digitized assets. For example, Picasso's paintings can be a traditional and valuable piece of art, and can also be a digital asset. As for the data itself, it is a digital asset of the original ecology.

Back in the real-life policy and business context of China's reality, Bitcoin is closer to being a unique digital currency because there is no legal legitimacy. However, the nature of the currency in Japan is legal, while in the United States it emphasizes the characteristics of its digital assets. This situation will continue in the long run and will not affect the position of Bitcoin in the digital currency world.

Wang Feng: I have noticed that in your past statements, Bitcoin is often referred to as digital currency. At the last Moganshan meeting, some representatives suggested that the central bank's digital currency could be called a digital currency. Once the central bank's currency is introduced, these things are difficult for the private sector to stand on. Based on long-term considerations, should we redefine Bitcoin, Ethereum, etc. as digital assets today? This can be a very tricky and sensitive issue. I hope to discuss it with you here.

Zhu Jiaming : This question has just been answered. In the digital economy, there is no clear boundary between digital assets and digital currencies. Another idea can be changed: perhaps we need to re-set the "digital currency" beyond the framework and constraints of the traditional "currency" concept. In other words, the “this currency” of the digital currency is not the “other currency” of the traditional currency. So, enter the height of the philosophy of money.

Wang Feng: The public has a negative perception of “fried coins”, which may come from the misunderstanding of digital currency. There is no way. In the recent centuries, it is difficult for people to accept non-state currency. Hayek’s thoughts are still put on the books, and most people find it difficult to understand. If these assets of Bitcoin can be legally recognized, there is an idiom in China called as the name suggests, we should further define clearly what is digital assets and what is digital currency. I think the Digital Assets Institute should promote it. I am worried that if the definition of digital assets is not clear, it will even destroy the role of blockchains in financial empowerment.

Zhu Jiaming : As I said before, it is difficult to clearly define digital assets in the future that can be met, because the concept of digital assets needs to be synchronized with the development of digital assets in economic life. Now, it takes a long time to define digital assets in legal terms. However, this situation does not affect the ability of the blockchain to finance.

“The development of digital assetization and asset digitization is very important”

Wang Feng: Sixth question, from a purely technical point of view, the blockchain solves the problem of financial inclusiveness. Blockchain technology makes it easier to issue digital assets. Everyone can use smart contract technology to issue digital assets. Various assets can record, validate, and transfer transactions on a multi-node data network. This is like Internet technology solves the problem of democratization of information, giving us the right to register a domain name and set up a personal website.

It can be discussed in two ways. On the one hand, if the original digital assets such as Bitcoin and Ethereum are understood as digital assets, in my opinion, today's digital assets are still only in the enlightenment stage of the original digital assets. In the future, there will be better bitcoin and better Ethereum; on the other hand, mapping large real economic assets to digital assets will create huge opportunities for emerging digital assets, which we can call “asset digitization”.

Then, the opportunity for digital assets is to vigorously develop digital assets, such as developing and improving native digital assets such as Bitcoin and Ethereum, or focusing on the development of asset digitization, such as encouraging STO? Today we should re-submit, can STO be discussed?

(Note: STO (Security Token Offering) refers to the issuance of the securitization certificate, which is issued by the security token. The equity represented by the securities category is more representative of the traditional equity. Ownership and repayment of future earnings represented by the creditor's rights. The holder of the securities pass will enjoy the ownership, dividends, future earnings repayment or voting rights of the blockchain organization according to the specific definition of the pass. Issuance and follow-up actions need to be regulated by the securities regulatory authority in accordance with the regulations.)

Zhu Jiaming : In theory, this is two parallel worlds, the digital world and the real world. Digital assets are the original production of the digital world, and asset digitization is the mapping of the real world in the digital world. The development of both worlds is very important, and there are no serious problems. However, in real economic practice, there are three lines: first, the emergence and development of new digital assets; second, the digitization of traditional assets; third, the integration or integration of new digital assets and digital assets.

“The goal of digital finance in the future is to achieve mutual finance”

Wang Feng: Seventh question, General Secretary Xi mentioned digital finance. In fact, the concept of “digital finance” has been proposed very early in China. The relatively simple definition is this: digital finance refers to a new generation of financial services that combines with the traditional financial services format through the Internet and information technology. Nowadays, China is in the forefront of the world in digital finance. Taking Internet mobile payment as an example, China is ahead of most developed countries. There is a saying on the Internet that compares “high-speed rail, scan code payment, shared bicycle and online shopping”. China's "new four major inventions."

In the speech of General Secretary Xi, the application of blockchain technology has been extended to the field of digital finance. How do you understand digital finance? What kind of promotion can blockchain technology play in the innovation of digital finance?

Zhu Jiaming : In traditional monetary theory, finance is a larger concept of money because it contains money, financial institutions, and financial institutions. The innovation of digital chain finance by blockchain technology not only provides a new financial “infrastructure”, but also affects all aspects of its financial system, such as stimulating and changing “accounting system”, commercial banking mechanism, money supply model, and financial asset form. ,Monetary Policy.

Wang Feng: Some people have already seen the challenges of blockchain technology for the traditional financial industry. At the Bund Financial Summit just held, Xiao Gang, a member of the National Committee of the Chinese People's Political Consultative Conference and former chairman of the China Securities Regulatory Commission, expressed his views on the blockchain from the perspective of the securities industry, attracting attention: "With the application of blockchain technology in the financial industry In-depth, there will be digital banks, digital investment banks, digital asset exchanges, and even similar institutions like traditional brokers, market makers, rating agencies and research institutions."

The contents mentioned by Xiao Gang actually include almost every subdivision module of the existing or traditional financial industry. As far as I know, among the global blockchain practitioners today, all the above services can Find the corresponding companies, such as those specializing in Bitcoin transactions, DeFi and Staking, at least a thousand in the world, and most of them are in the technical exploration before the introduction of regulatory policies.

In the past , you have made suggestions for China's reform and opening up , and what are your specific suggestions for the upcoming development of digital finance?

Zhu Jiaming : The main feature of digital finance in the future is the formation of a new financial ecology. There are two points to support this new ecology: first, the absolute monopoly model of the country that overcomes financial resources, and the gradual return of financial resources sovereignty to the people; second, the solution of financial resources. Hegemony changes the problem of uneven distribution of long-term global financial resources. Such a financial ecological goal is to achieve mutual finance, and is also an important source of eliminating human inequality and poverty.

“The most urgent task is to upgrade the legal legal system as a whole”

Wang Feng: Eighth question, although Xiao Gang has described the entire digital financial landscape in a very complete way, he also expressed concern. "These institutions have both financial and technological attributes, and even anarchist attributes. How to supervise? It is an unprecedented proposition, and the world's financial regulatory authorities are facing a test." I don't know what kind of reaction the former National Post and Telecommunications Bureau will see when he saw the e-mail. But Chairman Xiao’s concerns are enough to show us the difficulties of regulation and new technology in each other’s game.

General Secretary Xi also mentioned digital asset trading in his report. In fact, many young people regard digital assets such as Bitcoin and Ethereum as the best investments in their lives. In the ranking of Coinmarketcap, about half of the world's top ten digital asset exchanges are growing out of China.

If the government further supports digital assets, the transaction will be further active. At present, in all countries of the world, digital assets and digital finance-related supervision are relatively lagging behind. Although in the United States, Coinbase has obtained licenses for compliance digital asset exchanges, and some digital asset-related regulatory policies have been introduced in Singapore, but in China. Regulatory policies have been delayed, and there is even a lack of discussion.

The challenge we have today is whether China will introduce regulations on digital assets as soon as possible next year. Will there be a place for non-state-owned enterprises in the future of digital asset trading? Pure academic issues.

Zhu Jiaming : China has formulated relevant regulations on digital assets, which involve many aspects such as upgrading traditional laws, achieving technical aspects, and coordinating international cooperation. Ultimately, the problem that needs to be addressed is the fundamental challenges that the digital economy, digital assets and digital currencies pose to existing legal and legal systems.

The digital economy, digital assets and digital currencies are characterized by diversified subjects, high scientific and technological content, rapid expansion, strong subversiveness, and diversification of social penetration and influence. Compared with the status quo and trends of the digital economy and digital currency, the legal legal system presents four basic states:

First, new issues, legal gaps.

Second, it is difficult to keep up with the development speed of the digital economy and digital currency, which is seriously lagging behind. Now the gap between each other is not shrinking, but continues to expand.

Third, overreaction. Mistakes in some things, overkill, including the current reaction to Libra.

Fourth, the law and legal system do not have the power to deal with such situations in a holistic, rational or timely manner.

The main reasons for the imbalance between law and digital economy, digital assets and digital currency include the serious asymmetry of knowledge system, information structure and professional field. The legal jurisprudence system and other economic activities have never been as severely asymmetrical as they are today. The technical characteristics of the legal characteristics, the digital economy and the digital currency are too different, leading to unbalanced development. In addition, more importantly, there is no horizontal communication between government agencies, economic entities, scientific and technical personnel and the participating people. This is a unique historical phenomenon, and it can be said that there has never been a situation in the history of law.

Therefore, it is imperative not to establish rules for supervision, but to upgrade the legal system of law as a whole. The immediate work includes at least:

First, it sums up the economic and social relations and the renewal of legal concepts caused by the digital economy and digital currency. In this way, we can fill the state of "new problems, legal gaps" just mentioned.

Second, sort out the reality of the law and the digital economy and the serious asymmetry of digital currencies.

Third, how the refining laws can adapt to the major areas of the digital economy and the rapid development of digital currencies.

Fourth, learn from the successes and failures of the digital economy and digital currency governance at home and abroad. We still have a lot of cases.

As for the participation structure of future digital asset transactions, it depends on too many uncertain factors, and finally the development of related technologies and the design and operation of the system.

"The future will develop a competition for the right to interpret the blockchain"

Wang Feng: The ninth question, although Bitcoin appeared 11 years ago, most people still don't understand how the blockchain is going. In fact, there are many misunderstandings about blockchain in the society, mainly reflected in two points: 1. Blockchain is bitcoin, bitcoin is blockchain, narrowing the understanding of blockchain; 2. Blockchain Uselessness is only used as a hype for digital currency. Before the TPS didn't get up, the blockchain couldn't do anything. What do you think is the reason why the public has misunderstood the blockchain?

Zhu Jiaming : Nowadays, there are too many misunderstandings in the understanding and awareness of the blockchain by the public. It is fundamentally derived from the "technical black box" feature of the blockchain. In cybernetics, areas or systems that are not known are often referred to as "black boxes." Modern high-tech has a universal "black box character", and the public is not able to understand the scientific principles and technical construction behind it while using high technology. For example, the most common smartphone is a “tech black box” for the public. Blockchain is more "technical black box" than other high technologies.

This is because the general high technology can be perceived and judged in one way or another. For example, most people can feel the functions and performance of a smartphone, so they can use it. However, the blockchain is an infrastructure that cannot be seen or touched and cannot be felt in any way. When people use blockchain services or products, it is difficult to detect whether blockchain technology is utilized.

From the gene level of the blockchain, the gene of the blockchain is the code. The person who has the right to speak to the code is the programmer. Now, the blockchain is still in a relatively early stage of development. The technology has not yet developed to mathematically determine the performance, technology, and whether there are no loopholes in the blockchain. Therefore, it is still the programmer who can determine the blockchain. But who is going to judge the programmer itself? This has caused one of the biggest fallacies: the role of the blockchain is to replace human behavior and establish a mechanism for trust. However, the blockchain can prove that "you" is "you" but cannot prove that it is a "blockchain." The purpose of the blockchain is to distinguish between authenticity and falsehood, but the blockchain is difficult to distinguish between authenticity and authenticity. It is foreseeable that in the future, there will be a struggle for the “interpretation power” of the blockchain.

Wang Feng: As you mentioned in a speech, digital currency has become a very important complex economic phenomenon in the world today, and it needs to be understood with new thinking to deal with the challenges it poses. The multi-source, multi-factor, multi-dimensional and diversified digital currency will greatly enrich the complex science, and many people around us often use the inertial thinking of traditional and even Internet applications to understand the so-called blockchain application. It is not uncommon to understand digital currency and digital assets, such as whether the blockchain can make a taxi application or a better online game. From a higher historical perspective, what suggestions do you have for today's young people to understand the changes? What kind of help did the young 90s around you give you?

Zhu Jiaming : After 90 is a lucky generation, they will be witnesses, participants, and even leaders of a major transformational history. What they need most is to learn to continue learning and build an interdisciplinary body of knowledge. Their help to me is huge. I am constantly accelerating the evolution of history and the times from them, so that I can keep up with the times at such an age.

“The transformation of the digital economy has spawned new capital and wealth models”

Wang Feng: Tenth, you mentioned in a public speech that the most important choice in the 2020s is institutional + technological innovation, including shared economy, green economy, cooperative economy, and social enterprise. The goal of the monetary economy in the 2020s is inclusive finance. Regarding the status quo of the monetary economy, the four points that need to be emphasized are: the monetary and financial hegemony and monopoly are coming to an end, the monetary and financial science and technology revolution is maturing, the uneven distribution of monetary and financial resources tends to be equal, and the monetary and financial system is diversified.

I especially noticed that you mentioned the problem of the inequality in the distribution of existing monetary and financial resources. What do you think is the main historical cause of this?

Zhu Jiaming : What is “financial resource inequality”? It mainly refers to the generation and distribution of various financial resources, especially monetary resources, financial institutions including banks and funds, and the distribution and social distribution of capital markets and money markets. Can be summarized as:

First, the US dollar is the main body of the world's monetary resources; the Fed, and the traditional financial capital of Wall Street representatives, based on strong wealth, have long dominated the main direction of monetary and financial capital.

Second, the world's financial institutions, capital and money markets are mainly distributed in developed market countries, and emerging market countries have improved.

Third, between developed and developing countries, within each type of country, the gap between per capita monetary and financial resources is very large and is expanding.

Fourth, the growing financial strength of the world's multinational corporations and the close cooperation of commercial banks continue to be the biggest beneficiaries after the financial crisis.

Fifth, the IMF and the Bank for International Settlements have effectively influenced the rules and order of the financial system with the Basel Accord and various world financial cooperation organizations, such as the SWIFT and Ripple agreements. In addition, the imbalance between financial technology and innovation results sharing.

The main reasons for "inequality in financial resources" are historical and institutional reasons: including the deterioration of the Brinton Forest Conference system, the expansion of the world's floating exchange rate system, and the negative consequences of the Plaza Agreement; the US dollar still maintains the world's major, even The absolute status of “reserve currency”; the universal strengthening of the monopoly power of financial resources by various governments, the non-neutralization of monetary policy; the complicated mechanism of the global financial crisis, and the normalization of financial crises. In particular, the impact of the 2008 global financial crisis was extremely profound. Ten years have passed and it has not yet ended, at least leading to the era of zero interest rates and even the era of negative interest rates.

Wang Feng: We may wish to trace history. What efforts have the modern civilized society made to improve this resource inequality? What experiences and lessons have you had?

Zhu Jiaming : In the past few decades, in the face of global financial resource inequalities and consequences, people have been constantly proposing solutions and starting various trials and experiments. There are two major categories of “top-down” and “bottom-up”. Regarding the “top-down” programme and experimentation, the most successful euro issuance and the establishment of the euro zone. The existence and development of the euro is conducive to changing the monopoly position of the dollar, conducive to the balance of the world monetary system, and inhibiting the imbalance of global financial resources. In the “top-down” program, there was also the “super-sovereign currency” proposed by Wang Qishan and Zhou Xiaochuan, the heads of China’s monetary and financial institutions after the 2008 world financial crisis. However, this plan of China was not widely accepted. Implementation.

The “bottom-up” programs and practices are quite rich: the development of finance and “financial deepening” ideas; community currencies; “poor banks”, “time banks”, crowdfunding (Crowd Funding) And Peer-to-Peer Lending trials; the Tea Party Movement and the Occupy Wall Street Campaign. "Tea Party Movement"; the advent of Bitcoin and other encrypted digital currencies. In fact, there are more than these claims, movements and experiments. One thing is certain: the ultimate goal of people is to change the serious inequality of financial resources, and behind the serious inequality is the monopoly of financial resources.

Wang Feng: Too much emphasis on the equal distribution of financial resources, will it be just a utopian fantasy in the era of digital economy? Are you worried that even if the social wealth is redistributed after the opening of the digital financial market, there will still be new or even greater distribution gaps?

Zhu Jiaming : After the opening of the digital financial market, the social wealth was redistributed, and a huge distribution gap did occur. The geometric growth of the digital economy since 1961 has generated enormous wealth energy. While promoting social progress, the world is facing an unprecedented new inequality. This kind of inequality is more challenging than food, clothing and housing, based on inequalities in material production and material wealth. In the past year or two, the influx of traditional capital into the blockchain and encrypted digital fields has intensified the erosion of the original ecology and the deviation from the original intention of pursuing a wealth distribution model.

However, we need to note that any economic transformation will lead to the redistribution of wealth, accompanied by a large-scale "cutting amaranth" phenomenon. Ancient and modern Chinese and foreign, this is no more. However, in the history of human economy, the number of major transformations is quite limited. However, in the past few decades, as the progress of science and technology has accelerated and the economic impact has intensified, there has been a trend of increasing the frequency of transformation, and one transformation has stimulated and bred another transformation.

In the transformation of the digital economy, new capital and new wealth models are naturally generated. The cycle of the explosion of wealth has become shorter. With Nasdaq Power, four billionaires related to the digital economy were created early in the market. Today, in terms of the speed at which the British blockchain economy creates wealth, it is only about five years to build a wealthy owner with a billion-dollar basis. What is worthy of recognition is that such a new wealth model leads newcomers to become capital owners, always better than wealth is always controlled by the old family.

Further, if the growth rate of newly generated incremental capital far exceeds the growth rate of stock capital, it is a historical progress . In the era of digital economy, the two big bangs were not linear processes but nonlinear processes. The last incremental capital deposited is far greater than the stock capital. This means that the world has a new group of capital, a change, and the new owner of capital is a new generation. The main body of human wealth is shifting to the three generations of X, Y, and Z. Facebook has no problem, but it represents a future model of reform space. This issue is worthy of further observation and discussion.

Guest introduction:

Zhu Jiaming, economist, founder of the Institute of Digital Assets, director of the Academic and Technical Committee.

In the 1980s, Zhu Jiaming served as the head of the former Technical and Economic Research Center of the State Council, the International Institute of China International Trust Corporation (CITIC), the Western Research Center, the Beijing Youth Economics Association, and the China Reform and Open Foundation.

In 1984, the Moganshan Conference with historical influence was held in Deqing County, Zhejiang Province. Zhu Jiaming was the main initiator and organizer. In the 1990s, Zhu Jiaming was a visiting scholar at world-renowned universities such as Harvard University and Massachusetts Institute of Technology.

After 2000, Zhu Jiaming was an economist at the United Nations Industrial Development Organization (UNIDO) and taught at the University of Vienna and the University of Taiwan.

Since 2010, Zhu Jiaming has been involved in the research of encrypted digital currency and blockchain, and served as an academic advisor to the Digital Assets Institute.

Zhu Jiaming's representative works are "The Theory of National Economic Structure", "Reality and Choice", "Unbalanced Growth", "From Freedom to Monopoly: China's Monetary Economy for Two Thousand Years", "Book Collection", "Libra: A Financial Innovation Experiment", etc. .