The People's Bank of China, China's central bank, has completed trial runs on the algorithms needed for digital currency supply, taking it a step closer to addressing the technological challenges associated with digital currencies, according to a top official associated with the project.
Yao Qian, director-general of the Institute of Digital Money at the PBOC, said China's central bank has successfully designed a prototype that can regulate the supply of its future digital fiat currency.
The successful simulation of money supply paves the way for the central bank to become the future sole regulator and policymaker governing the value of digital fiat currency, said Yao.
Digital fiat currencies are the digital forms of a sovereign currency that is backed by the central bank.
Unlike Bitcoin or other digital money issued by the private sector, the digital fiat currency has the same legal status as the Chinese yuan, the only fiat currency issued by the People's Bank of China.
There is no timetable for the introduction of the currency, but once introduced, China is likely to become the first country that would deploy a digital fiat currency....
The rapid development of the electronic payment sector and thriving private digital currencies have made it imperative for China's central bank to move quickly in digital finance.
Looking ahead, deploying the digital fiat currency is expected to be smarter and more intelligent compared to the payment providers using existing currencies, such as Alipay, according to Yao.Ecns.cn
PBOC inches closer to digital currency
China Daily
1 comment:
Once that’s done, it becomes even easier to implement full reserve banking. That is, anyone wanting their money to be totally safe can have an account at the central bank. In contrast, anyone who wants their money loaned out with a view to earning interest, which is what private banks currently do, carries the risk themselves.
That disposes of a nonsensical aspect of the existing system namely that if you want a privatge bank to lend out your money, the taxpayer protects you against loss. Whereas if you want a stockbroker or mutual fund or pension fund to lend out or invest your money, those organisations are SPECIFICALLY PROHIBITED from promising you your money is safe. Barmy.
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