China’s Central Bank plans to issue a national digital currency

China’s Central Bank plans to issue a national digital currency

China’s Central Bank is considering issuing its own digital currency. According to officials it is not based on the blockchain.

In an interview with the publication Yicai, Deputy Chairman of the people’s Bank of China Fan Yifei said the preliminary plans for a potential digital currency.

He said that the Bank currency would be significantly different from the decentralized tokens, but the main priorities will remain the centralization and control of the issue.

The Chairman of the Bank said:

“Digital currency will represent the monetary obligation of the Central Bank to society. The nature of this commitment will not change due to the transformation of money from cash to digital.”

“Digital currency will allow to restrict the demand of the society for crypto-currencies and strengthen the role of our national currency.”

He also noted that digital currency will not work on peer to peer mechanism for making anonymous cryptocurrency. Transaction using state of the digital currency will be able to track the Central Bank, which does not allow to put it on the money laundering and illegal activity.

Also the Central Bank cautious about implementing smart contracts can automate the process by using its digital currency. Fan explained that the currency would essentially be the equivalent of the Renminbi, which means it will be subject to the laws governing the treatment of Fiat currency country.

In accordance with the existing laws of China, the yuan can only be used for the pricing, handling, calculations and storage. Fan explained that the same features will carry a digital currency, and functionality of smart contracts can automate the process of collecting taxes and raising funds.

It is noteworthy that the authorities considered the creation of a national digital currency in the last year. In November 2017, the head of the research Institute of the people’s Bank of China Yao Qian is considered extremely important to the emergence of the state of cryptocurrency in the country:

“It is essential to accelerate research in this direction and to produce a national cryptocurrency as quickly as possible.”

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