China plus bitcoin is a marriage of convenience

China plus bitcoin is a marriage of convenience

(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)NEW YORK  - Tech mogul Peter Thiel suggested this week that China might use bitcoin as a “financial weapon” to unseat government-backed currencies in general and the U.S. dollar in particular. The People's Republic is indeed keen on digital currencies. But bitcoin isn't its best way to challenge the greenback.In theory, a love child of the yuan and bitcoin could give the dollar a run for its money. China's currency is a reasonably good store of value, and the giant economy that sits behind it – incidentally where the majority of new bitcoin is mined – makes it potentially useful, too. Bitcoin's charms include immunity from government intervention, including the devaluation risk presented by U.S. President Joe Biden's multi-trillion-dollar infrastructure plans.But both have big flaws. For China, a government so hands-on with the economy and capital flows argues against the yuan becoming the global monetary lingua franca. The country accounted for 13% of world exports in 2019 but represents only around 2% of central banks' foreign exchange reserves. While bitcoin comes free of government meddling, its volatility makes it a terrible store of value. And mining and settling