A leading figure in the Chinese financial establishment has revealed that the People’s Bank of China (PBOC) has already finished development of the backend architecture for its Central Bank Digital Currency (CBDC) (Digital Currency/ Electronic Payments).
“The establishment of the backend architecture for DC/EP is already complete,” said Wang Zhongmin (王忠民), formerly the vice-chair of the National Council for Social Security Fund, on 20 June at the 2020 Fintech Forum held by the Tencent Fintech Research Institute and the Fintech 50 Forum.
“It is currently at the testing stage. If in future DC/EP can be further optimised, China will achieve a payments structure in which sovereign digital currency and market digital currency co-exist, creating a healthy environment for competition and cooperation.”
Wang also pointed out that the spread of the Novel Coronavirus is “driving an intensification in competition between global digital currencies.”
“At present Libra 2.0 has already broken through the previous payments framework, and is exploring a digital wallet based on social media. A digital US dollar is already taking part in the competition between global digital currencies.”
Within China, Wang sees COVID-19 “expediting new scenarios and functions for digital currency, and increasing the global competitiveness of digital currency.”
“The use of digital currency to implement targeted subsidies, avoid the setting of complex standards and procedures of the past, has increased the execution efficiency of policy.
“At present the market has already created the backend infrastructure [for digital currency] based on digital payments and settlement.”