PBoC Chief Says Cash Might Become Obsolete As Digital Payments Evolve

China has been one of the first countries to oppose the use of virtual digital currencies. China’s crackdown on digital currencies started last year in September 2017, when it has put a blanket ban on ICOs and trading in cryptocurrencies thereby causing all the exchanges in the country to shut down.

However, amidst all the blockade coming from the Asian giant, a surprising statement came from People’s Bank of China (PBoC) governor Zhou Xiaochuan. Earlier this week on Friday, March 9, during China’s annual two sessions conference in Beijing, the chief of China’s central bank admitted that cash might become obsolete in a few years from now as digital payments technology evolves.

He said that the country is studying digital currency technology which facilitates faster payments at reduced costs. However, he stressed on the fact that the authorities aren’t rushing to release a cryptocurrency of their own the moment.

Moreover, Zhou also criticized decentralized digital currencies such as Bitcoin saying that its highly speculative nature doesn’t serve any purpose to the economy in the long run. On the other hand, a central bank-issued digital currency will avoid speculation, reports the official press agency for the PBoC Xinhua.

Zhou, during his press conference, stated: “We must prevent major mistakes that would lead to irreparable losses, so we are cautious. We don’t like creating products for speculation and making people have the illusion that they can get rich overnight.”

China has been flexing its muscles even today to block any and every possible route for its citizens to trade in cryptos. Recently, the country’s regulators even went to the extent of not allowing its citizens to trade in digital currencies even through foreign exchanges.

Soon after the briefing after the PBoC governor this Friday, there are also rumours floating that the Chinese regulators are now looking to block the social media accounts of cryptocurrency exchanges as a part of its latest crackdown.

Last month, a report said that the regulatory authorities would “take regulatory measures against ICOs and virtual currency exchanges inside and outside the country” with blocking access to crypto exchanges outside the country.

On the other hand, China’s central bank is pushing towards developing its own cryptocurrency after it established a ‘digital currency research institute’ in mid-2017 with an increasing focus towards having a state cryptocurrency. The central bank has reportedly completed a digital currency trial on a blockchain that includes some major commercial banks as its participants.

Things remain quite shady and unclear as to how exactly China is willing to contribute in the digital currency space.