The Central Bank of China issued some comments referring to progress without any setback on the creation of the Digital Yuan, a cryptocurrency backed by the Chinese government.
The People’s Bank of China (PBoC), which is the highest financial institution in the Asian country, said in a statement that it is “progressing smoothly” in creating the digital currency that will be used by the country and will be supported and certified by the government.
The declaration on the progress of the Central Bank on the crypto assets was offered during a working conference, which was held in Beijing, on January 2 and 3, 2020, according to a press report published last January 5th.
Extensive Preparation for the Creation of the Chinese Digital Currency
As is known, the Chinese government has spent more than five years investing in the research and creation of a new digital currency supported by the Central Bank. After half a decade of previous work, the first pilot test of the digital currency that the Chinese government hopes to launch shortly was developed last December.
The data offered by the authorities indicate that unlike a conventional cryptocurrency of private and decentralized origin, this digital asset will have the status of legal tender. The Digital Currency of the Central Bank (CBDC) will have the support of 100% of all the reserves of the public commercial institutions that are listed on the institution. This refers to having a total weight character over all the commercial activities of the country.
This was certified by the financial institution itself, which has been constantly updating its information on the progress of the new Digital Yuan. About the support that the new digital currency will have, the PBoC certified that it has all the support of the institution, thus it was confirmed during the conference aimed at the “study and application of the spirit” in the Fourth Plenary Session of the 19th Central Committee of the Communist Party of China, held last October 2019.
In this way, the conference was developed with the statements of Yi Gang, who is the president of the People’s Bank of China. He detailed the challenges and the main tasks of the institution to continue its progress in the construction of “Socialism with Chinese characteristics” by 2020.
According to projections of the Central Bank for the current year 2020, directed by the Central Committee of the Party and the State Council, it is planned to make “Anti-Cyclical Adjustments” in monetary policy. In this way, they will seek to focus on the liberation of the Chinese economy and focus on avoiding financial risks for the future.
China and the Global Blockchain Industry
The impact of the blockchain strategy that the Chinese state develops for its assets in the rest of the decentralized protocols that make life on some aspects within the Chinese economy and its surroundings is not yet clear. So many analysts are evaluating the movements that Beijing has on its policies. In this way, they try to determine its growth by evaluating censorship, international strategy, regulation and control, and its operation within its economic environment.
To get an idea about the complexity of China’s financial policies in these terms, it can be cited an interview conducted by a news web portal to Wulf A. Kaal. He is an expert with a Ph.D. in technology consulting.
Kaal recalled the words and opinions of Joe Lubin, who is co-founder of Ethereum.
“We could discuss what decentralized means in the case of China. If we agree that decentralized, it would mean at least a sample resistant to autonomous and anonymous censorship. It is difficult to see the Chinese government facilitating that”, he explained.
By María Rodríguez