The lead researcher at China’s central bank has claimed that a central bank cryptocurrency should be developed and issued at the earliest in the country.
According to statements reported by the South China Morning Post, People’s Bank of China (PBoC) lead researcher Yao Qian has expressed the immediate need for the central bank to develop and issue its own cryptocurrency as a means toward bolstering China’s digital economy. Qian heralded digital legal tender as “the jewel in the crown of fintech” that will go on to have a sweeping impact on the world’s financial system.
A cryptocurrency serving as legal tender would bring financial inclusion with services offered in rural areas, bring down transaction costs and increase the efficiency of monetary policies implemented by the central bank, according to Qian.
The PBoC researcher stated:
The development of [the] digital economy needs central bank-issued electronic currency more than ever. It’s crucial to speed up their research and issuance.
Qian’s comments further underline China’s endeavor to take a proactive lead in issuing a central bank cryptocurrency. The PBoC’s effort to understand a central bank digital currency began in 2014 with the establishment of a ‘special’ research team. The initiative became public knowledge in early 2016, when the central bank reveled its intent to “introduce a digital currency as soon as possible.”
The PBoC completed a successful trial run of its digital currency on a blockchain earlier this year, followed by a the establishment of a ‘digital currency research institute’ laboratory alongside the offices of the China Banknote Printing and Minting Corporation, the state-owned entity responsible for printing and minting China’s fiat currency, the renminbi.
Qian went on to add:
What the central bank have in mind is a centralized digital currency among all. As money has evolved from the barter system to its metallic and paper forms, it is now going digital.
China’s sprint toward a central bank-controlled cryptocurrency comes amid its infamous sweeping ban on initial coin offerings (ICOs) in September. The regulatory ban, effectively curbing an innovative new method of fundraising powered by cryptocurrencies, has also led to the shuttering of cryptocurrency exchanges in the country.