The People’s Bank of China (PBOC) is making plans to harness the crypto wave in a way that it’s in favor and in full control of their Central Bank.
Earlier in the year, The Peoples Bank of China (PBoC) held its 2018 National Currency Gold and Silver Work Video and Telephone Conference on March 28, where among all
things, currency related the continuation of strict regulations on cryptocurrency was announced.
Though much of the time was dedicated to acknowledging the accomplishments of the PBoC through the previous year there were other points on the agenda, one of which was the development of the PBoC’s own digital currency and the control of unofficial ones.
For Years China has been making plans towards integrating it’s Yuan to the Blockchain Network. To this incentive a Digital Currency Research Institute headed by Yao Qian was formed back in 2014 and now they are actually taking steps towards implementing the idea.
PBoC governor Zhou Xiaochuan has been clear that the country does not recognize digital currencies as it does traditional fiat saying the “The banking system does not accept it.”
At the same time, the PBoC is planning its own ‘official’ digital currency called DCEP (Digital Currency for Electronic Payment) which will be in development through to 2019. The currency will strictly suit the needs of the country according to Xiaochuan, who elucidated by saying it should focus on “convenience, rapidity, and low cost in a retail payment system while taking into account security and protection of privacy.”
China has even bucked the trend that most other countries with stringent regulatory policies have established. That of damning cryptocurrency while embracing blockchain and distributed ledger technology. Xiaochuan has warned that the expansion of the emerging technologies could have a negative effect on consumers and cause financial instability.
Yet the Government has sponsored crypto and blockchain related research and development for years and some time back sent a delegation to Australia to study how blockchain can be used to advance the countries fintech industry.
It seems China’s fear is not of the developing technology but, of developing technology creating an alternative to the Yuan and of the hundreds of billions in lost revenue that may result from people bypassing the official currency in favor of a global decentralized digital one that allows them to spend how, where and when they wish.
Following the trends it clearly shows that China is in the lead to creating Fiat digital money.