The chinese central bank is on track to complete the design of its digital currency. The development of essential functionalities would thus be completed and the China would tackle the legislative aspect of the issuance of a CBDC.
The central banks major economic powers are all currently carrying out reflections, even experiments, around the regulated digital currencies or CBDC. The China is perhaps the most advanced country in this sector, although it is difficult to confirm this for lack of official communication from the authorities.
According to the Chinese site Global Times, a new step has been taken in the development of a crypto-Yuan, an electronic and sovereign currency issued by the central bank. In partnership with private companies, it would therefore have finalized a first functional version.
The essential functions of an e-Yuan combined
A e-Yuan With basic or essential functions designed, the Chinese authorities are now working on the drafting of various laws allowing the circulation of central bank money.
In any case, this is what sources within the industry involved in the project suggest. And according to the Chinese daily, the current crisis, which has pushed states to pour liquidity and lower rates, would encourage the acceleration of the launch of this cryptocurrency.
The justification ? : "Cryptocurrency is considered the most practical tool for translating a central bank's zero and negative interest rate policy to commercial banks. "
The China remains in his habit discreet on this sensitive subject of monetary policy. A few months earlier, the project manager at the central bank, Mu Changchun, already assured that the functional research and the test of Digital Currency Electronic Payment were completed.
Most of the work is not technical, but regulatory
In January, Chinese fintech Alipay has also published five patents relating to this central bank currency. These relate in particular to the issue, recording of transactions and wallets.
If the company did not wish to comment on this information, Global Times reports that these patents indeed relate to basic functions of a digital currency, such as circulation, payment, issuance, but also the fight against money laundering.
However, the technical part represents only part of the work necessary for the issuance of a central bank money and its regulation. The various regulators and the legislator still have to agree on a common framework and carry out large-scale experiments with the banks. A release date of a e-Yuan therefore remains uncertain.