Cryptocurrency & Blockchain Business

Bitmain Wants to Create Private Central Banks on the Blockchain

There are always intriguing developments taking place in the cryptocurrency world. Bitmain, the world’s leading cryptocurrency mining hardware manufacturer, wants to invest in startups. That in itself is not surprising, but the company’s end goal is a bit of a surprise. They seemingly aim to create private central banks on top of blockchain technology.

It is evident the terms “central bank” and “cryptocurrency” do not mix all that well. In fact, these terms are almost mutually exclusive, especially in a positive manner. That hasn’t kept companies from trying to build their own blockchain-based bank solutions, though. For some reason, Bitmain is now aiming to provide private central banks on the blockchain. It sounds ambitious, intriguing, and worrisome all at the same time.

A Weird Plan for Bitmain

More specifically, anyone who owns cryptocurrency already is their own bank. There is no need for central entities to be part of this ecosystem whatsoever. Even so, Bitmain co-founder Jihan Wusees a bright future to combine both worlds. Bridging the gap between fiat money and cryptocurrency will always be a challenge. A blockchain-based bank may not necessarily hold any answers in this regard either.

A private central bank would be better at creating user experiences. Bitmain is very interested in this private central bank model. The company aims to issue private cryptocurrencies as a service which is certainly interesting. At the same time, we don’t exactly need more cryptocurrencies that do not serve a purpose. Anything linked to a bank of any kind will be scrutinized and ignored, for rather obvious reasons.

For now, Bitmain will look for several dozen startups to invest in. How that will all play out exactly, remains to be determined. It is evident current central banks are inadequate to complete any of their normal tasks. Moreover, the average consumer has no faith in these institutions either. What role Bitmain aims to play in this regard, is still unclear as of right now. Exploring new business ventures is always positive, but this idea raises a lot of questions.

Header image courtesy of Shutterstock
by JP Buntinx

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