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October 30, 2020
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China accelerates development of its digital currency

China is expected to become the first country to have its own digital currency.

“China needs to become the first nation to issue a digital currency.”

This can be read in an article published in China Finance, a review by the Chinese central bank (PBoC), as reported by Reuters.

The aim would be to further internationalize the yuan and reduce its dependence on the global dollar payment system.

In fact, according to China Finance, the rights to issue and control a digital currency should become a “new battleground” for competition between sovereign countries, and the issue of digital currencies by central banks would bring major changes to the system current global financial situation.

In this sense, the PBoC itself points out that the country would have many advantages and opportunities to issue your digital currency (DC / EP) and, therefore, should accelerate in this direction to reap benefits before others, especially as digital. The currency can improve the implementation of monetary policy and thus better support the post-pandemic economic recovery, in addition to helping to break the dollar’s international monopoly.

It is worth adding that until yesterday the yuan appreciated significantly against the US dollar, from US $ 0.1415 in early July to US $ 0.1480, with a gain of more than 4.5% in less than two months. Today, however, after the publication of the China Finance article, it lost 0.46%.

It is possible that the PBoC intends to devalue the yuan against the dollar, to help exports, following the growth of the last few months, and perhaps a digital currency can help to do so, for example, by distributing money directly to citizens, as done by example in the United States in the midst of a pandemic emergency.

China digital currency forwarded

In the meantime, the field test of Chinese cryptocurrency is already underway, so much so that local media reports that some of China’s leading state-owned commercial banks have already begun to conduct large-scale internal testing.

In addition, a research unit has already applied for 130 patents for this new digital currency, which would form a complete supply chain to support its launch.

As a result, it is now evident that China is really taking this seriously, although it is not yet clear what the deadline will be.

Source: cryptonomist

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