Exclusive Interpretation | Tencent Blockchain White Paper on Libra, Face Up or Downward Strike?

On October 19, 2019, the 2019 Tencent Blockchain White Paper was released at Tencent's first digital transformation strategy meeting jointly held by Tencent Research Institute, Tencent FIT, Tencent Cloud, Tencent Legal Innovation Center and Tencent Finance and Economics. .

Babbitt notes that in the white paper, Tencent is interested in Facebook-sponsored Libra, which mentions Libra 13 times in its entirety. Can not help but imagine, as a social giant, will Tencent launch the Chinese version of Libra to block Facebook's Libra?

In the first chapter of the white paper "The development status of the blockchain industry", Tencent used the "industry ecological prototype has emerged, Facebook took Libra strong entry" to demonstrate. The wording of "strong entry" is enough to show Tencent's emphasis on Libra. Tencent has since praised Libra, such as:

"As can be seen from the Libra white paper, Facebook's strategy seems to be radical and bold, but it is sober and secure, adopting the development strategy of 'rural encircling the city', and its vision' allows the world's 1.7 billion people who cannot access financial services to enjoy financial convenience at a low cost. The essence of service is to first attack developing countries with underdeveloped financial facilities, especially those with insufficient credit credit, and then gradually penetrate into developed countries.

It can be seen that Tencent is very convinced of Facebook's play.

Another example is to evaluate the impact of Libra's landing. Tencent wrote:

"If Libra successfully landed, it will undoubtedly greatly affect the global payment industry to the entire financial industry, promote the industry's innovation in user experience, cost, technology and business models, and accelerate the industry reshuffle. In addition to the direct impact of traditional financial institutions. Internet companies with relatively complete payment ecosystems (such as Tencent, Ali, etc.) will also be affected by the downsizing, affecting their global strategic layout."

This evaluation can clearly see Tencent's crisis awareness .

Tencent started with socialism and has been hoisted by Alipay in the payment field. Although Tencent’s Tenpay (founded in 2005) has long been in the market share of mobile payment, it is the second largest Alipay subsidiary. 2003) is a far cry. According to the iResearch report, in the field of mobile payment, Alipay's market share in 2014 was as high as 82.3%, and the second place in Tencent Tenpay was only 10.6%.

WeChat screenshot _20191021192353

Until Tencent hatched WeChat and launched the WeChat red envelope on WeChat during the Spring Festival of 2014, this action seems quite simple, which is to transfer the custom of red packets from the Chinese during the Spring Festival. However, this move was a great success. WeChat red envelope quickly became Tencent's explosive product. Later, Ma Yun compared WeChat's launch of WeChat red envelope to "sneak attack on Pearl Harbor" , which shows that WeChat red envelope has a huge impact on the mobile payment landscape.

Soon after, Tencent ended its history of being hoisted for more than 10 years in the field of mobile payment. The market share has risen sharply, and it has finally achieved a parity with Ali. According to the “China Third-Party Payment Industry Data Release Report for the First Half of 2019” released by iResearch, in Q2 2019, Alipay and Tenpay have the largest market share, which are 54.2% and 39.5% respectively.

WeChat screenshot _20191021192055

Sometimes, historical changes are often an accidental event. This is especially true in business activities, and a rapidly emerging explosion is enough to change the industry landscape. No one would have thought that in the field of payment, Tencent, the younger brother who had been fighting with Ali for more than 10 years, caused a heavy blow to Ali, who had several times his own weight, with a WeChat red envelope overnight, even after leaving Ali for 10 years. road.

Therefore, there is reason to believe that Facebook's Libra is no less powerful than Tencent's WeChat red envelope . As Libra members become more diverse and international, once Libra succeeds, it is likely to cause a devastating blow to all potential rivals in the current mobile payment industry, and Tencent is naturally included.

Therefore, Tencent believes that Libra will cause a downsizing against Internet companies with relatively complete payment ecosystems (such as Tencent, Ali, etc.).

So, is Tencent ready for a hard-headed approach?

The white paper did not continue to discuss, and there is no positive response from Tencent insiders about whether Tencent is ready to respond to Libra.

On June 18th, the Libra white paper was officially released. On June 19th, Ma Huateng made a comment on the WeChat circle of friends. Ma Huateng’s understatement of the commentary contrasts sharply with the view that most people at the time viewed Libra as a beast.

Picture 7

After a lapse of four months, Libra talks about Libra in the white paper of the blockchain, which is different from Ma Huateng’s understatement. The white paper uses words to reveal a tension like an enemy.

Perhaps it can be speculated that Tencent’s internal attitude is changing?

This can be found in the white paper.

Libra is a pass. We have noticed that Ma Huateng commented in the comments: “It depends on whether supervision is allowed”. The complete sentence is “depending on whether the regulation allows Libra to be issued”. Because, the current status quo is that most countries do not support or even prohibit the pass, these passes can only be transferred in the gray zone.

Interestingly, the White Paper has repeatedly mentioned the pass, and it is also very optimistic about the incentive mechanism for the pass.

For example, the expression for the certificate is:

“Another controversy in the blockchain industry is the application of the certificate. In the process of the application of the blockchain, it is inevitable to consider the transfer of asset value between businesses, and the pass is generally considered to be tradable encryption. The proof of digital rights can be used as a medium for value exchange to realize a lot of online and offline assets (such as securities, points, tickets, certificates and qualifications), and complete the circulation transactions in the chain. Whether it is C-side or B-end applications, Pass is a double-edged sword. Good use can greatly contribute to the development of the entire application ecosystem. If it is not good, it will easily hurt itself and accelerate its demise. If the design of the economic system is reasonable, it can help the entire application community from multiple dimensions. The development can not only significantly reduce the costs of financing, research and development, operation and customer operations, but also revolutionize production relations, distribution mechanisms, business models and community governance."

The implication is already obvious. Tencent’s value for the certificate is recognized. Of course, everything has two sides, and the card is no exception.

For the incentive mechanism of the pass, Tencent wrote:

“Diversified incentives can also allow more users to spontaneously integrate into the ecological development of the entire application. However, some projects are blindly sending money, harvesting non-food, and not carefully studying the relationship between the CIS economy and its own applications. Relationships, coupled with the lack of intrinsic value, ultimately lead to the unsustainable project. Therefore, whether to introduce the certificate in the project and how to design the certificate system, we need to consider designing the certificate based on the intrinsic value of the project in the regulatory environment. The mechanism balances the interests of all parties and promotes the healthy development of their projects and the subsequent benign development."

In this passage, Tencent pointed out the chaos of the current census incentives, and should consider the regulatory environment design pass.

Tencent did not explicitly state whether it would introduce a pass in the current domestic environment. However, from the white paper's wording, if the time is ripe, Tencent is likely to issue a pass to block Libra.

At that time, a payment war will be launched, and the situation of payment in the world will be greatly changed.

However, fortunately, with the pressure from the international community, the founding members of Libra continue to leave, and it is not known whether it will be issued smoothly. What is left to Tencent is time.

We will continue to update Blocking; if you have any questions or suggestions, please contact us!


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