It was announced that all would be ready to go to the launch of pilot programs. Mu Changchun said that the digital yuan cannot be used to speculate.
A senior official of the People’s Bank of China (PBoC) said that they will launch a “digital form” of the national fiat currency, the yuan. Mu Changchun warned that the digital yuan cannot be used to speculate and announced that all would be ready for the launch of pilot programs.
It was explained that the cryptocurrency planned by the People’s Bank of China will not be subject to financial speculation mechanisms nor will it have support anchored to any currency basket. This was stated on the weekend of December 21st and 22nd by Mu Changchun, head of the digital currency research division of the Central Bank of the Asian country.
Changchun considers that the digital currency that the Chinese government plans to launch is not like Bitcoin or other decentralized cryptocurrencies and stablecoins, which can be used to speculate or require the support of a basket of currencies. This was reported by the Hong Kong English-language newspaper South China Morning Post.
In the same way, the official said that they are already advanced in the design, a phase of functional tests and even tests of the process of payments with a digital currency. Only the implementation of pilot programs for the launch of the digital currency would be left to do, as highlighted by the same source.
The Asian country has been advancing in the plans for the launch of its cryptocurrency throughout the year 2019. Among those advances, the most prominent is the adoption of the law for the use of cryptography at the end of October.
It should be noted that this legal instrument aims to lay the foundations for the launch of the Chinese digital currency, without this implying the flexibility of trading with decentralized cryptocurrencies in the Asian country.
It is relevant to mention that the launch of this legal instrument came after President Xi Jinping raised the need for the Asian country to lead the development of blockchains. In a speech to the Communist Party of China (CPC), the president emphasized the potential of blockchains as an emerging industry.
Other Important Facts
Many critics have expressed concern that China could use its digital yuan to increase surveillance on its citizens. However, Changchun said that the People’s Bank of China will guarantee cash-like levels of privacy for its transactions, while still being able to trace what it suspects to be illegal activity.
It was also reported that China’s central bank is accelerating its efforts to launch the digital token to challenge the US dollar. The People’s Bank of China stated that it plans to conduct the first real-world test of its digital currency before the end of 2019. Besides, four major banks and some major economic participants such as China Telecom would test digital currency payments under its supervision.
By Willmen Blanco