China Charges Ahead With a National Digital Currency

Yet no major power rests with China. Its initial steps may indicate where the rest of the world goes with digital currencies.

“It’s about more than just money,” said Yaya Fanuci, a partner at the Center for Economic and Financial Power, a think tank, and a writer. Recent paper On Chinese currency. “It’s about developing new tools to collect data and leverage that data so that the Chinese economy is more intelligent and based on real-time information.”

Although the Chinese government has not said when and when it will officially apply nationwide, several officials have mentioned getting ready for tourists arriving for the 2022 Olympics in Beijing. Recent articles and speeches by officials of the People’s Bank of China, which is the country’s central bank, underscored the project’s ambitions and desire to be the first.

“The right to issue and control digital currencies will become a ‘new battlefield’ of competition between sovereign states.” An article In China’s finance, the central bank magazine, in September. “China has many advantages and opportunities in issuing fiat digital currencies, so it should provide momentum to seize the track first.”

The People’s Bank of China did not respond to a request for comment.

The development of the national digital currency began in 2014, when the People’s Bank of China formed an internal group shortly after to work on one. Bitcoin increased Meditation in the country. In 2016, the central bank created a division called Digital Currency Institute. According to research by Sino Global Capital, a financial investment firm, last year it started trials of eCNY in Shenzhen, Suzhou, Jiogan and Chengdu cities.

Those invited for the test via lottery on WeChat or other apps were able to click on a link and get a balance of 200 electronic yuan, which sometimes accompanied an old-fashioned Chinese banknote with Mao. The picture was displayed in his bank app on Zedong’s face. To spend money, users can use an eCNY app to scan the retailer’s QR code or produce a QR code that the retailer can scan.

The design of ECNY borrows only some minor technical elements from bitcoin and does not use it So-called blockchain technology, A bookkeeping-like system that most cryptocurrencies rely on, officials at the People’s Bank of China have said.

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