Summary

The article distinguishes the Chinese government's central bank digital currency (CBDC), known as the Digital Currency Electronic Payment (DCEP), from the cryptocurrency Yuan Chain (YCC), emphasizing that DCEP is not intended for speculative investment and cautioning against YCC due to its lack of transparency and potential for being a short-lived, low-value token.

Abstract

The article "Yuan Chain (YCC) Is Not The Digital Currency (DCEP) Used By The People’s Bank of China" clarifies common misconceptions about the digital Yuan, which is actually a central bank digital currency (CBDC) issued by the People's Bank of China (PBoC). Despite widespread media coverage and public interest in government-backed digital currencies, the author asserts that the digital Yuan, or DCEP, is not a cryptocurrency but a digital form of the Renminbi (RMB) with no speculative investment value. The article also warns against the Yuan Chain (YCC) token, which is an unrelated, Ethereum-based ERC20 token with low liquidity, questionable claims, and an anonymous team, suggesting it may soon become worthless and is not endorsed by the Chinese government. The author advises readers to avoid investing in YCC or DCEP for capital gains, as these digital assets do not align with the typical goals of cryptocurrency enthusiasts, such as financial independence or technological innovation.

Opinions

Central bank digital currencies (CBDCs) like the digital Yuan are mistakenly thought to be cryptocurrencies with investment potential, but they are actually just digital fiat currencies with stable purchasing power.
The digital Yuan (DCEP) is the first CBDC in the world, backed by the RMB and controlled by the PBoC, but it lacks the decentralized and immutable characteristics of cryptocurrencies.
Yuan Chain (YCC) is criticized as a pointless token with a misleading name, designed to capitalize on the hype around the digital Yuan, and is likely to be a short-lived project with little real-world utility.
The YCC token's daily trading volume is low and potentially manipulated through wash-trading, and its value is heavily dependent on its listing on exchanges like Huobi Global.
The YCC token's website and team lack transparency, with privacy protection services obscuring ownership and a whitepaper listing team members by first names only, raising red flags about the project's credibility.
The author emphasizes that neither YCC nor DCEP align with the motivations of most cryptocurrency investors, as they offer no technological innovation, financial independence, or anti-establishment appeal.
DCEP is described as a centralized stablecoin that may be useful for transactions within China or on participating platforms but is not suitable for those seeking capital gains through speculative investment.

Crypto Missive

Yuan Chain (YCC) Is Not The Digital Currency (DCEP) Used By The People’s Bank of China

I’ve been getting lots of questions recently about a “digital Yuan,” both from customers of BitPrime and the general public. The internet is buzzing with talk of governments getting into crypto. Outlets from Forbes and The Economist to CNBC have all been interested in the developments. But things aren’t as they seem, or as crypto investors might want them to be.

A digital Yuan is the “next big thing” you say

Because central bank backing of cryptocurrency lends legitimacy to the whole crypto-sphere, people want to believe that it’s a game-changer. It is, but not for cryptocurrency. The digital Yuan is not a cryptocurrency; it’s a central bank digital currency (CBDC), which is just a fiat currency sitting on a blockchain or similar distributed ledger technology (DLT).

The other fallacy in the crypto universe regarding CBDC is that they’re a good speculative investment opportunity. Sorry to break it to you — they’re not. By nature, CBDC are designed to have stable purchasing power and no speculative investment potential over and above standard foreign exchange trading. Keep moving; no new opportunities here.

“This confusion is caused by a case of mistaken identity. Central bank digital currencies are not cryptocurrencies and have no investment potential. They’re fiat currencies using slightly less antiquated than they did in the past.”

The digital Yuan is only the next big thing if you like buying junk on JD.com. It offers no advantages over existing payment technology and cryptocurrencies.

I’m not only picking on China here. As things stand, all proposed CBDCs belong in the same shitcoin can.

The DCEP (Digital Currency Electronic Payment) is China’s central bank digital currency

The digital Yuan, officially known as “digital currency electronic payment” (DCEP), is the world’s first CBDC. The People’s Bank of China (PBoC) first issued the tokens in September 2020. One DCEP is backed by and redeemable for one Renminbi (RMB). In this respect, it has some similarities with fiat-backed cryptocurrency stablecoins. However, as we’ve discussed, it’s centrally controlled and in no way immutable or censorship-resistant.

DCEP is controlled by the People’s Bank of China and issued through state-owned banks and major Chinese payment networks like WeChat’s payment channel and Alipay.

A CBDC is a big deal for China and the PBoC, so there has been a considerable amount of publicity around it. And whenever there’s a buzz about something new, in ride the copycats, charlatans, and even outright scammers.

Yuan Chain (YCC) is an Imposter

Introducing Yuan Chain, the latest in a long line of pointless tokens that will be listed on deadcoins.com in six months.

It’s a thinly traded token built on the Ethereum network (ERC20). YCC has about USD 150,000 volume daily at the time of writing, predominantly on Huobi Global. I suspect much of this volume is wash-trading also. YCC is illiquid and would lose most of its value if Huobi ever delisted it.

Why does this token even exist? I’m not going to reward them with a backlink, so you’ll have to Google them to find their website. By the way, the website looks like it was designed in about two hours and only uses free stock images. Here is an excerpt about the token:

Why YCC?

-Easy to use, no barriers.

-Back with a team of 300 outstanding developers and other specialists.

-One-stop full service, from start to end.

-High-scale ecosystem, large coverage, good for the development of individuals and SMEs.

-100% developed and designed in China, upgrade and maintenance will not be limited and constrained by foreign blockchain network.

-40% of the mining revenue goes to development foundation as technology funds, enabling technical sustainability.

-Taken public welfare, taxation and government surveillance into consideration, grows together with the government and society.

None of these stated benefits are any different or better than 90 percent of ERC20 tokens out there. It’s what you would write if you wanted to launch a cryptocurrency but had no idea what you wanted it to be or how to build it.

Now here’s a big red flag. Who.is information shows that the website has privacy protection, so there’s basically no way to determine who owns or controls it. Also, most of the team listed in the whitepaper only give a first name.

Anyway, I’ve already given these guys too much oxygen. Let’s move on.

DCEP is not a vehicle for speculative investment — It’s a centralised stablecoin

Most cryptocurrency enthusiasts are in it for the money, technology, independence, and the anti-establishment vibes. Everyone has their reasons, but these are the most common ones. DCEP offers none of these things. It provides nothing for the average cryptoholic.

If you live in China or frequent some of the sites where they’ve done giveaways, like JD.com, it’s probably a good way to pay for stuff. But that’s where it ends.

Don’t buy YCC or DECP if your goal is to profit from capital gains

Ross Carter-Brown is the founder of the cryptocurrency trading platform BitPrime, co-founder of CuratedCV, and the publishing company Trinary Ink. The information in this article is an opinion only and not intended as personalised investment advice. This article may also contain affiliate links. Do your research and seek independent professional advice before making any financial decisions.