“There Is No Inevitable Relationship Between Digital Currency and the Blockchain:” Chinese Central Bank

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A senior official from the digital currency research team of the Chinese central bank says that China’s efforts to develop a statutory cryptocurrency will not involve competition with existing forms of money.

“There is in fact no direct relationship at all between a statutory digital currency and the blockchain,” said Jiang Guoqing (蒋国庆) from the People’s Bank of China Digital Currency Research Institute at the 2018 China Fintech Development Forum.

“The blockchain is just one option for the circulation of a statuary digital currency. A statutory digital currency is still a binary system, which is issued and circulated by means of a central bank and commercial banks, instead of being issued extraneously.

“A statutory digital currency will not compete with existing money, but will jointly develop with existing money and payment methods.”

Jiang called for the rational, pragmatic treatment of blockchain technology and innovations, as  opposed to “mystification” of its role.

According to Jiang the blockchain is subject to “many limitations,” and “we still need to wait and see whether large-scale application is possible due to endogenous technical defects.”

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