Scholar’s Advanced Technological System

Bitcoin is crashing?

When Lu Zhou heard the news, he was dazed.

He had planned to use bitcoin to test whether his computer was fast, but before he could do his tests, the entire bitcoin market exploded in his face.

The way he heard the news was quite interesting.

The people that lost some money couldn’t do anything. It wasn’t like they could go and complain to Wall Street.

The people that suffered more substantial losses had an interesting reaction. They came all the way to Jinling on a maglev train. They found the Jinling Institute for Advanced Study and stood outside the gate with a “Return My Hard-Earned Money” banner.

This scene shook the scientific researchers inside the institute. Many scientists even began to watch the fun through their windows.

However, the security guards weren’t there for nothing. The security team stood shoulder to shoulder outside the gate. The people outside the entrance felt intimidated by the wall of guards, afraid to cause any more trouble.

However, compared to the calm researchers at the research institute, the management team was not as calm. When the higher-ups heard that the gate of the Institute for Advanced Study was blocked, these old men were so scared they nearly had a heart attack.

Almost all of the police cars in the entire district were dispatched here. Bystanders didn’t know what was going on. They thought it was a large-scale anti-terrorism exercise.

The documents issued by the People’s Bank of China in 2017 already set the outline of bitcoin. They claimed that bitcoin was just a virtual commodity and not a currency. They also prohibited Chinese financial institutions and payment companies from providing tools to use and purchase bitcoin.

Bitcoin was always in a gray area, not supported by the state, yet now people were running outside and protesting.

Police cars rushed to the scene and arrested anyone blocking the entrance. They brought the protesters back to the precinct and interrogated them one by one on where they bought the bitcoins.

Those that bought the coins abroad were left alone. Those that purchased the coins through illegal channels were further investigated; none of them were spared.

Immediately afterward, something more interesting happened. The people who were investigating suddenly discovered that most of the protesters were not trading bitcoins.

Even after tearing through the internet records of the protesters, they were not able to find any traces of bitcoin transactions.

The task force leader realized that something was wrong, so he immediately reported the news to his superiors.

In the end, people from the Ministry of State Security joined the task force.

Finally, everything was clear.

Last time, when they were cleaning out the foreign spy networks, the bitcoin transactions fell through the gaps.

These spies were thinking about protesting and applying for asylum status; a paradise position for immigrants. But the second they put their heads above the surface, they were immediately caught.

After Lu Zhou heard the story from Director Li, he shook his head and spoke.

“These people are crazy.”

I’m not the one that shorted bitcoin, why protest against me?

Go protest on Wall Street?

He really didn’t know why these neanderthals blamed him for this.

“This isn’t even bad.” Director Li took a sip of tea and said, “You haven’t seen the people that destroy real estate company buildings just because their property values are decreasing. The people that have bitcoins are somewhat civilized; it’s just a few banners and signs outside your office.”

Lu Zhou: “Yeah, we weren’t affected too badly, thanks to you guys.”

“Don’t mention it.” Director Li smiled and said, “You should have seen the look on Vilgas’ face at the Asia-Pacific Cyber Information Security Summit yesterday.”

“Vilgas?”

Lu Zhou frowned. He had never heard this name before.

“Oh right, I forgot… Vilgas is the chairman of the Federal Communications Commission.” Director Li said with a cheeky smile, “If you know what I mean.”

The Federal Communications Commission directly answered to the United States Congress, while the United States Congress represented the interests of most American capitalists.

Obviously, when it came to the issue of communications security, the United States Congress had serious disagreements with the White House. Since the White House had yet to express their position on the cyber information security summit, the United States Congress sent their own personnel to attend the conference.

The reason was obvious. The poor performance of the US stock market frightened everyone.

After all, a certain US president said that if the US stock market were to plummet, the president should fly to the sun on a rocket.

Although the United States Congress did not tie the president to a rocket heading toward the sun, things had developed to a point of no return.

“But to be honest, even though the digital currency is not regulated, it is an attempt to decentralize the finance industry. The fall of bitcoin is not necessarily a good thing for us.”

After taking a sip of coffee, Lu Zhou, who was not very interested in this conversation, replied casually, “Oh, is that so?”

“The current economic trend is globalization. Since the international community is headed to a multi-country world, the international monetary system does not make any sense, as it is not backed by precious metals anymore. Besides, there hasn’t been any change since World War II; it’s time for some change.

“Keynesian economics is still relevant. Developed countries can easily inflate their own currency in regard to underdeveloped countries, thus preventing the prosperity of others.

“If we want to end this unfair exploitation, there must either be a powerful world central bank to formulate monetary policy based on the global scale, or we would have to have a world-wide and reliable currency. This currency cannot be controlled by the policies of central banks, it has to be self-regulating. Central banks should be allowed to buy this currency freely as a hedge against their own currency.”

Humans had a history of decentralization. The only difference was whether the decentralization was fierce and immediate or slow and gradual.

In 1994, Kevin Kelly used a bee colony as an example in his book “Out of Control”. He proposed a redistributing capitalistic structure, which was probably the embodiment of decentralization.

Unfortunately, bitcoin and other digital currencies had the spirit of decentralization, but they were not able to fully achieve their mission.

There was no real backed commodity as a guarantee; it was just a number on a ledger. It was just a solution to difficult mathematical problems. Therefore, it could easily be dominated by quantum computers.

Perhaps a digital currency backed by a powerful credit entity would be more reliable. But then again, the essence of a digital currency was that it was not controlled by mainstream corporations. If a digital currency could be guaranteed and fully controlled by a credit entity, could it really be considered a digital currency?

This was a catch-22.

Lu Zhou didn’t understand economics very well, unlike Chen Yushan or his sister. Thus, he sat there quietly and silently watched Director Li talk out of his a*s.

After Director Li was tired of speaking, he finally took a sip of tea and rinsed his throat.

However, just when Lu Zhou thought he would change the conversation topic, the old man suddenly asked, “Do you think there is a possibility?”

Lu Zhou: “Possibility of what?”

“To use quantum algorithms and generate a digital currency based on quantum encryption technology?”

For some reason, when Director Li said these words, the atmosphere in the living room suddenly froze.

Lu Zhou did not reply. He quietly drank his coffee as he looked at Director Li.

Director Li couldn’t help but laugh and say, “What are you looking at me for? I’m just curious, just an idea…”

Lu Zhou put down his coffee cup and picked up the teapot on the table.

“I’ll pour you some tea.”

Director Li immediately waved his hand.

“No, no, it’s fine, I still haven’t finished yet. I can pour it myself later.”

Lu Zhou: “No, it’s fine, drink some more.”

Director Li: “Ah, you’re too kind… Wait wait wait, slow down, it’s spilling!”