China will test a digital version of its currency
China will test a digital version of its currency at the 2022 Winter Olympics in Beijing.
The news was reported in an interview with Chinese financial journalists, hosted by the Chinese governor, Yi Gang, and on the bank’s website. The People’s Bank is China’s central bank.
In the interview, Yi said that China has completed “high-level design, standardization, function development, joint debugging test, mainly for the digital version of the yuan, the domestic currency.” The governor said the currency would offer “cash replacement, and controllable anonymity” and would be usable without involving any financial institution in the transaction.
The latter is important because other digital payment systems revolve around private companies that charge transaction fees for most merchants. China’s approach is to transfer digital currency from device to device that can change hands as if it were cash.
“Currently, digital RMB [yuan] research and development work adheres to the principles of sustainability, safety, control, innovation, and practicality,” Yi said in an interview. “First, internally closed pilot tests are performed in Shenzhen, Suzhou, Xiangang, Chengdu, and the upcoming Winter Olympics scenarios to verify theoretical reliability and system stability. Performance, availability of functions, ease of operation, scenario Applicable, and risk controllable. “
(The Olympic reference identifies Beijing as the host of the 2022 Winter Games.)
But the governor also said the test could not result in the introduction of digital cash.
“However, the current pilot test research and the development process is still a routine, and that does not mean that the digital RMB will be formally released,” he said. “There is no set timetable for when it will regular start.”
Yi said the reason for the tests is that “the digital economy is an increasingly important driving force for global economic growth” and “legal digital currency to effectively satisfy the people’s demand for legal currency under the terms of the digital economy.” Suitable, which has been improved. Convenience, security and anti-counterfeiting levels of retail payments, and accelerating the growth of China’s digital economy. “
And that the economy can take advantage of the momentum. Yi elaborated on the effects of the Quad-19 epidemic calling China the “Great Suspension” of the global economy, including the annual annual GDP contraction in China during the first quarter of 2020. But the governor also said that indicators of manufacturing activity have changed in a positive direction in recent months.
With 44 to 40 votes, Beijing won the bid for the 2022 Winter Olympics in Almaty, Kazakhstan (Almaty is a city in Kazakhstan). This makes the Chinese capital “Beijing” the first city to host both the Summer and Winter Olympic Games.