China’s Central Bank PBoC Accelerates Its Development on Digital Currency

China’s central bank - The People’s Bank of China (PBoC) - has recently issued a fresh statement saying that it will accelerate the research and development for the state-owned digital currency.

The talks about China’s plans to issue a CBDC surfaced soon after Facebook announced launching its native Libra cryptocurrency by the next year. A local official of the PBoC confirmed that the central bak cites an imminent threat from Facebook’s Libra which could potentially challenge China’s cross-border payments, financial sovereignty, and monetary policy.

Last week on Friday, August 2, the People’s Bank of China (PBoC) hosted a video conference discussing some major tasks for the second-half of 2019. During this meeting, the regulators kept a special focus on cryptocurrencies saying that they will closely monitor the developments in the global crypto space.

Last month, the PBoC director Wang Xin stated that Libra could “could create a scenario under which sovereign currencies would coexist with U.S. dollar-centric digital currencies. But there would be in essence one boss, that is the U.S. dollar and the United States. If so, it would bring a series of economic, financial and even international political consequences.”

The PBoC said that besides accelerating its own CBDC development, they must also pay special attention to other domestic and foreign cryptocurrencies. Moreover, the bank said that regulators should prepare themselves to quickly respond to social concerns,  strengthen financial risk remediation along with the policy propaganda interpretation.

In 2017, China introduced an outright ban on the use of cryptocurrencies as well as several products associated with it. However, looking to the global demand of crypto use, the PBoC wants to put special focus on the development of Digital Renminbi that could help China to place itself at the forefront of the digital currency race.

The PBoC has already received clearance from the State Council to start working on its CBDC project.