China’s Interest in Facebook’s Libra Spikes on Hearing Libra Will Compete with Alipay, WeChat
China’s interest in Facebook’s Libra immediately spiked in response to the company’s intention to compete in its payment solution with Chinese payment giants Alipay and WeChat Pay during the hearing on Libra with the Financial Services Committee of the United States House of Representative on July 17.
Sina Weibo’s (Twitter equivalent in China) hot search shows that the hashtag “Libra will compete with Alipay and Wechat” hit the 2nd hottest search on the country’s biggest social media platform a day after Libra hearing.
Google trends also shows that China has been the first in the list of countries in searching keyword Facebook Libra, while the U.S, the birthplace of the crypto project, ranks 30th in the list, showing only ~1/5 the interest from China.
The country has been paying particular attention to Facebook’s Libra upon the release of its crypto project whitepaper one month ago. Since then, Libra has been one of the most talked-about topics among cryptocurrency buffs, finance experts, as well as politicians in the country these days.
Bitcoiners believe that it is a bullish signal and a good advertisement for the crypto market; industry watchers and regulators raise concerns over Libra’s threat to major fiat currencies and that it may change international financial order.
Zhou Xiaochuan, the former governor of PBOC (People’s Bank of China), stated that Libra represents the trend of digital currencies, China should take precautions and undertake policy research. He also proposed that there might emerge a more internationalized, globalized currency, a currency so strong that it will cause major currencies to establish exchange relations with it. It may not necessarily be Libra, but there will be more institutions and people try creating it.
Aside from Libra’s potential to spark a currency war and fears that it may further consolidate dollar dominance, Chinese people have also felt Libra’s threat to digital payment giants like Alipay and WeChat Pay in their global expansion.
With the vision of creating a simple global financial infrastructure that empowers billions of people around the world, Libra aims to make money global and accessible for everyone. This makes most Chinese people associate it with Alipay, the world’s largest mobile payment platform with more than 1 billion users worldwide, and indeed Libra itself has just confirmed their plan to compete with Alipay and WeChat Pay. While Alipay and WeChat Pay (both centralized and fiat-based payment platforms) have kind of achieved what Libra is trying to do WITHOUT issuing any token which is the stem of international regulators’ concerns over the possibility that it will pose risks to the global financial system.