China does not have a timetable for the launch of its own digital currency despite having researched the topic for about five years, the People's Bank of China (PBOC) governor Yi Gang said this week.
China's central bank has a dedicated digital currency research institute which has been looking into the digital currency issue since 2014 and it has made positive progress in the subject over the years, according to Yi, who said the current plan is to eventually package the digital currency with electronic payment instruments.
"The goal [of the digital money] is to replace a part of M0, that is to say it is aimed to replace a part of cash. But it is not intended to replace M1 or M2 money," Yi said, according to a full transcript of his speech published online.
In August, another PBOC official, Mu Changchun, said in a forum that the timing was almost ripe for the introduction of a central bank digital currency in China after five years of study.
Mu, who took the position as the new head of central bank's digital currency research institute in September 6, made claims earlier this month that the Chinese central bank's digital currency has the best "legitimacy and security".
Tencent's WeChat payment and Ant Financial's Alipay, the two popular mobile payment methods in China, will not be affected by the digital currency as the introduction of a digital token would replace the cash currently settled by the Chinese banks.
Mobile payments have been extremely popular in China, the government has nevertheless been tightening its grip on digital currencies like Bitcoin. China prohibited local financial institutions from handling Bitcoin transactions in late 2013.
China has also started clamping down on cryptocurrency trading. It banned Initial Coin Offerings in late 2017 and closed down more than 100 cryptocurrency exchange platforms last year.
The South China Morning Post has reported the country's economic planning body is moving to ban cryptocurrency mining facilities.
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