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China CBDC would only be for domestic use after launch

Digital yuan

TL;DR Breakdown

  • China to use CBDC locally after launch.
  • China to take CBDC test to more regions.

Zhou Xiaochuan, a former Governor of the Peoples Bank of China, has said that the China CBDC (Central Bank Digital Currency) would be utilized locally instead of a global use immediately after the currency goes public.

According to the former PBOC governor, international use of the China CBDC would lead to global issues and affect monetary policy independence. Xiaochuan said this while speaking at the Boao Forum in China, a four-day annual international conference. The former governor also spoke on the potential of criminals beginning to use the currency and how the PBOC can forestall such from happening.

The Digital yuan has been subject to test in the past few months as pilot programs are running across different parts of the country. The country, however, has not given a precise date when the currency would launch. The bank’s deputy governor, Li Bo, spoke about increasing areas the China CBDC is being tested. The bank also may be looking at testing the CBDC for cross-border payment as the Winter Olympics scheduled for 2022 looms. According to Li Bo, the currency would be offered as a payment means for local and foreign users, including athletes.

China CBDC to be tested across more provinces

The PBOC has continued to widen the testing ground of the CBDC into new regions in the country. The Hainan province is the latest to begin testing the new mode of currency in the Asian country.

The bank is also preparing to take the currency to Sansha City, which will be for two weeks, and raise awareness about the digital currency. Towards encouraging people to use, the government offers a rebate of 15 percent on every 1000 yuan spent on the island.

World powers continue to embrace CBDC idea

CBDC has continued to draw the attention of world powers, with the European Central Bank, ECB, and the United States of America talking about it non-stop. The ECB president, Christine Lagarde, has always expressed interest in the subject and said at some point Europe would launch its own CBDC. She, however, states that the process could take about four years.

The US has also not stopped talking with Fed chair Jerome Powell making comments about the CBDC severally at different forums.

Muhaimin Olowoporoku

Muhaimin Olowoporoku

Muhaimin loves writing on crypto news aside from being a crypto enthusiast. He has a knack for analysing issues and updating people on what's happening around the globe. He believes that blockchain and cryptocurrency are the most useful systems of mutual trust ever devised.

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