The Chinese central bank is calling for the introduction of the digital yuan
The Chinese central bank is calling for the introduction of the digital yuan

A senior Chinese central bank official said: China should intensify efforts to adopt a sovereign digital currency - the digital RMB - as an important part of the independent financial infrastructure in the digital age.

Chen Yulu, deputy governor of the People's Bank of China (BPC), made the aforementioned remarks a few months ago when the main Chinese leader proposed a new economic strategy to support future growth.

China hopes to do so by relying more on domestic demand and hopes to maintain its isolation from the growing geopolitical tensions (especially those with the United States).

As other major central banks have made progress in developing their sovereign digital currencies, they have also provided the comments mentioned above.

We need to build an independent and high-quality financial infrastructure, accelerate research and development of the central bank's digital currency, and ensure that the pilot program shows that the digital RMB can be controlled, Yulu said.

The Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, Riksbank, the Swiss National Bank and the Federal Reserve published a joint report last week with the Bank for International Settlements on potential cooperation in national electronic currencies; Avoid unexpected obstacles.

China was not involved in drafting the report. The Bank of Japan plans to test the central bank's digital currency from next year, and the European Central Bank is expected to begin public consultations on the creation of a digital euro.

The Chinese central bank has not announced any international cooperation on digital currencies, and there are growing signs that China is about to adopt a digital renminbi.

China could extend the experiment to more areas or add more application scenarios. Given the Chinese economic size and implementation experience, any international cooperation without China's participation will result in losses to the international community of the United States.

Since the search for digital currencies began in 2014, China has occupied the first place in the development of digital currencies, and in 2017 it established a special institution for this purpose.

The Chinese central bank is conducting tests including the Digital Currency Electronic Payment System (DCEP), and the government has made clear that the goal of DCEP is to replace cash and maintain government control of the currency.

"So far, 3.13 million transactions have been made using digital RMB, with a total of 1.1 billion yuan," said the deputy governor of the People's Bank of China.

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