A distinct advantage of digital currencies such as Bitcoin (BTC) is emerging, with millions of small and medium-sized Chinese companies reporting that they will run out of cash within months as businesses shutter due to the coronavirus. Facing the highest risks are labor-intensive industries such as restaurant and catering, airline, hospitality and retail, reports Bloomberg.
While Chinese President Xi Jinping promises to unleash more reserves for commercial lenders to boost funding, the response from the country’s largest banks has been insufficient. China’s largest lender, the state-owned Industrial and Commercial Bank of China Limited, is offering financial assistance to only 5% of its small business customers.
Under these circumstances and the ongoing spread of the coronavirus, bank runs are now a real threat in China.
Direct contact with physical cash, unlike virtually currencies like Bitcoin, is presumed to spread the virus which has afflicted 79,360 people worldwide with 77,150 cases in China.
NBC News chief foreign correspondent Richard Engel reports that the confirmed number of cases may be low.
A dr treating coronavirus victims in hong kong just told me he doesn't think the world is aware of the dangers. Thinks, based on what he’s seen, the virus is far more widespread than being reported. “If you see one cockroach, you know there are more”
— Richard Engel (@RichardEngel) February 23, 2020
Last week, a high-ranking official of the People’s Bank of China revealed that China is quarantining old bank notes to curb the spread of the coronavirus.
According to Dr. Susan Whittier, a clinical microbiologist at New York-Presbyterian Hospital at Columbia University Medical Center, there are other culprits that are even more likely to transmit the virus: hard surfaces like physical coins and credit cards. Says Whittier,
“Cash is not a good vehicle to transport respiratory viruses, however, cards have a little bit more potential. If someone is coughing, and then they hand their credit card to someone across the counter, I wouldn’t rule out the potential of transmission.”
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