In a recent speech to a group of bankers and regulators at the Bund Summit in Shanghai, the founder and former chairman of Alibaba Group, Jack Ma, offered critical acclaim to the disruptive nature of digital currencies in shaping the future global economy. He said: “Digital currency could create value and we should think about how to establish a new type of financial system through digital currency.” Jack Ma highlighted that the Basel Accords-regulated financial system is a hurdle for young people or young economies to develop as they focus on financial risk control.
Why it matters: There is a double standard in the global financial system. Nations like the USA are able to take wild risks, and then bail out the banks when things don't work out. This simply isn't possible for smaller economies, who have to rely on foreign capital to develop their economies. In many ways cryptocurrency eliminates this double standard. And forces everyone in the system to play by the same rules. Much like gold, cryptocurrency can't be created by central banks, which may be a problem for the current economic model as more people turn to cryptocurrency as a means of escaping the fiat currency system.