Alibaba Co-Founder Jack Ma Bashes Bitcoin, Leverages Blockchain Technology
Jack Ma, co-founder of the Chinese technology conglomerate Alibaba Group, has yet again raged against the bitcoin machine, calling it a foreseeable bubble. At the same time, Alibaba Group subsidiary Ant Financial espoused bitcoin’s ground-breaking blockchain technology in a bid to lower transaction fees levied by banks on cross-border payments.
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Jack Ma Reversing the Banking Equation
On June 25th, Ant Financial launched a blockchain-powered remittance service in collaboration with Standard Chartered PLC and Philippines-based mobile wallet and remittance service provider GCash. Using blockchain technology, the company aims to lower the high remittance fees that banks impose on overseas payments.
Initially, the joint venture is targeted at the 200,000 Filipino workers in Hong Kong to facilitate near real-time remittances to the Philippines, as reported by The Wall Street Journal. Ant Financial plans to expand the service to other countries after weighing the success of the blockchain venture. Ant Financial, also known as Alipay, is the world’s largest mobile and payments platform, serving over 450 million users.
Earlier this year, Ant was blocked from purchasing the U.S.-based money transfer company MoneyGram International by the U.S. National Security Panel. Since then, Ma, who is the controlling shareholder of Ant Financial, has been proactively trying to enter the remittance industry:
“Traditional financial institutions serve 20 percent of people and make 80 percent of profits. New financial institutions should service 80 percent of people, and make 20 percent of profit.”
Aiming to reverse the present equation, Ma’s Ant Financial is interested less in cryptocurrencies than in blockchain technology, seeking to leverage the latter to facilitate fast and cost-effective cross-border payments.
Centralized vs Decentralized Blockchains
Ant Financial’s blockchain solution is a blend of traditional banking and blockchain technology. The solution retains institutional trust while concurrently using bitcoin’s underpinning technology.
The solution also seems to partially fulfill bitcoin’s aim, transacting fast and inexpensively. Yet the primary problem of “the middleman” remains. In this case it is Ant Financial controlling a centralized blockchain. While the idea of bitcoin was to develop a trustless decentralized system to transact money, Ant is among a number of enterprises to use the technology, but balk at the spirit of decentralization.
Speaking on bitcoin and blockchain tech, Ma said, “Blockchain technology could change our world more than people imagine, bitcoin, however, could be a bubble.”
It is not the first time Ma has declared bitcoin a bubble. Recently, speaking at the 2nd World Intelligence Conference in Tianjin, Ma emphasize that blockchain tech is legit but bitcoin is a potential bubble.
Self-made billionaire Jack Ma joins the rank of co-billionaires Bill Gates and Warren Buffett in slamming bitcoin while seeing potential in blockchain technology. In contrast, Twitter and Square CEO Jack Dorsey envisages bitcoin becoming a global currency in a decade.
Will Jack Ma backpedal on his bitcoin standpoint? Share your views in the comments section below.
Images via Pixabay