China’s central bank – People’s Bank of China (PBoC) is preparing to release their own cryptocurrency project, a senior official stated. PBoC’s research and development team have been working around the clock since 2018 to develop the infrastructure behind the cryptocurrency.
Mu Changchun, who is deputy director of the payment department at PBoC, stated that the project is close to a release, but he didn’t specify an exact date for the release.
Mu emphasized on PBoC’s plans to replace cash in circulation, which would not affect monetary policies and create a credit for China’s government. Another aspect of the new cryptocurrency is to support the circulation of the falling Yuan and to enable its internationalization.
The five-year-long research that PBoC conducted was catalyzed by Facebook’s intentions of releasing their own cryptocurrency – project Libra. Central banks around the world raised flags of concern, regarding Libra’s regulation and monitoring by central banks. The reason – to protect the client from potential foreign exchange risks. As opposed to typical decentralized blockchains, PBoC’s cryptocurrency will provide Beijing with enhanced control over their monetary policy.
„Libra should be put in the foreign currency category, and as such, it must be put under China’s government forex management framework,” Sun Tianqi stated. Sun made his statement as an official from China’s State Administration of Foreign Exchange at the China 40 summit, held in Yuichin Heilongjiang.
Patents from China’s central bank show that both retail and corporate users would install a digital wallet app in their smartphones and exchange Yuan for the new cryptocurrency. The feature also enables users to send and receive funds. PBoC emphasizes on the fact that with utilizing blockchain, the bank will know when money has been moved from one wallet to another.
According to PBoC’s work plans for 2019 uploaded in early August 2019, research and development will continue. Constant monitoring over crypto assets trends worldwide will remain active.