August 16 2019

China Digital Currency is Ready 🥇

A senior official of the Central Bank of China at a meeting of China Finance 40 Group announced that the country will soon deploy the Central Bank Digital Currency of the (CBDC). 🏦

Mu Changchun, deputy head of the Payment and Settlement Department of the National Bank of China, said theCentral Bank Digital Currency prototype that has been under research and development since 2014, now exists. 🔥

Changchun said: “Now we can say that the digital currency of National Bank is ready”. The digital currency will not be completely built on the “classic” blockchain architecture, as this will not allow reaching the required liquidity for use by retail customers. 🤔

Changchun said the Central Bank Digital Currency will use a two-layer structure:

The National Bank of China is the highest level, and commercial banks are the second level. This dual delivery system is suitable for our national conditions. It can use existing resources to mobilize the enthusiasm of commercial banks and smoothly improve the adoption of digital currency.

A two-layer system is preferred due to the complex economy of China, its vast territory and large population. It will also allow the use of the intellectual and innovative capabilities of commercial enterprises that will collaborate with the National Bank of China to deploy currencies. In addition, such a system will help to avoid concentration of risk. 💼

Mu Changchun noted that the two-layer operating system will not change the foreign currency debt and debt relations in circulation. Upon receipt of each transaction from the Central Bank, commercial institutions will pay the full amount and 100% of the reserve to the National Bank of China.

The digital currency of the National Bank of China remains central. The forum was also attended by Shaofu Dzjun, Executive Director, Chairman of China UnionPay. He noted that digital currency can solve the problems associated with cross-border transactions, long delay times and outdated inefficiencies.

But the goals of China’s Central Bank Digital Currency will be difficult to achieve due to the lack of clear operational processes and a detailed regulatory framework. 📝

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Posted 16.08.2019 by admin in category "Crypto World News