Asia Blockchain Updates 2019.12.10 PBoC’s Digital Currency Out soon, Apply to Shenzhen & Suzhou City
PBoC Will Use Digital Currency first in Shenzhen and Suzhou City,
2.8Billion USD Bonds on Blockchain Led by China,
PBoC: “CBDC of China Will be Used in Shenzhen and Suzhou first.”
China Economic Newspaper Caijing（财经）announced that “The official digital currency in China will be first used in Shenzhen and Suzhou.”
Caijing said that legal digital currency management will be overseen by the central bank of China, PBoC, with other three state-owned commercial banks, Industrial Bank of China, Agricultural Bank, Construction Bank, and three major mobile operators, China Mobile, China Telecom and China Unicom.
The specific timeline of the issuance of CBDC has not been disclosed yet, but most of the experts are forecasting that PBoC will issue its digital currency very soon.
According to the recent statement of Governor of PBoC, Yi Gang, this Digital Currency is simply a ‘digital cash’.
This is likely to be a replacement for cash or coins in the future. It means the digital currency will replace part of the monetary base (MO), which also means cash currency.
The issuing institution, the People’s Bank, does not supply digital money directly to the people, but rather to those other commercial banks, and those Commercial banks will supply digital cash to customers and the public.
Since CBDC is issued, it is stored in the smartphone app ‘e-wallet’. Users will be able to use a digital currency like Alipay, a popular electronic payment platform in China.
Vice-President of People’s Bank of China announced on Nov 28th in the financial forum that the design, standardization and joint testing of digital currency were basically completed, and that the pilot region would be selected for real use.
The digital currency by PBoC is far from the existing private cryptocurrency, such as Bitcoin, which uses blockchain technology.
PBoC Issued 2.8Bill USD worth of Bonds based on Blockchain
The Interest of blockchain technology in China has increased impressively. According to the Chinese media’s report, the People’s Bank, the central bank of China, has issued special financial bonds worth 2.8 billion USD for SME(Small Medium-sized Enterprise)s based on blockchain.
The funds will be used for issuing loans, especially for small and medium-sized companies. At the end of September, the People’s Bank of China also has issued 57.7 billion USD to 410,000 SME enterprises. The number has been increased by about 35%, compared to the same period last year.
The Chinese government is paying more and more attention to the digital economy, esp Blockchain technology. In early December, Forkast Insights, an Asia-based research division, conducted in-depth and comprehensive research on how blockchain technology can be integrated in China.
The report states that blockchain technology has been rapidly matured in China and there are actually a large number of “actual and practical use cases beyond the experimental stage.”