In Part II, we elaborate on how these digital ecosystems are increasingly defined by their competition and rivalry, as the United States and China compete to secure platform dominance and to reap the gains of governing through platforms. The United States, as the global digital incumbent, wants to preserve and expand its global platform power by ensuring no rival firms can emerge and that ‘latecomer industrial strategies’ ofthe kind pursued by China do not significantly displace US incumbents. The United States is mobilizing an expanding suite of tools to meet this challenge. As a latecomer, China is able to employ a different competition strategy to the United States. It is more accepting of its technologies being integrated with others – including those from the United States – in third countries. Meanwhile the United States has pursued a more rigorous ‘stack rationalization’ approach, attempting to eliminate as far as possible all traces ofChinese technology it deems threatening. For now, this grants China an advantage, as it can focus more attention on rollout, implementation, and ecosystem development, while the United States must do all this alongside devising exclusionary agreements and encouraging adoption of more expensive alternatives to Chinese suppliers. In the process, SPC competition increasingly and systematically blurs the boundaries between state and private actors.
In the remainder ofthis text, we examine how this competition unfolds across four different spheres: digital currencies, cybersecurity, standards, and smart cities. We focus on these four spheres because while none are traditional sectors ofthe economy, but they represent key areas where powerful platform firms and states can reshape rules, institutions, and norms in ways which embed their technologies ever more deeply in third countries’ technology stacks.
5 Digital Currencies
The United States is the world’s supreme monetary power. The US dollar remains the most widely used currency for cross-border payments by far, representing about half of all trade settlements and 62% of global forex reserves. The dollar maintains an enduring power vis-à-vis its major rivals, including the renminbi (RMB).
State Platform Capitalism
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