PBOC “progressing smoothly” with cryptocurrency

06 Jan 2020

PBOCThe People’s Bank of China has reported that it is “progressing smoothly” with the development of the government-backed cryptocurrency.

According to a press release on Sunday, the central bank issued the statement during a conference in Beijing last week.

China has been undertaking research and system development work on the upcoming central bank digital currency (CBDC) over the pat five years, carrying out the first real-world pilot of the currency last month.

A news report by local news outlet, Caijing at the time stated: “One step will be to rationally select the pilot verification area, scenario and service scope, and steadily promote the introduction and application of digital form of fiat currency.

“Compared with the previous pilot, this time the central bank's legal digital currency pilot will go out of the central bank system and enter real service scenarios such as transportation, education, and medical treatment, reaching C-end users and generating frequent applications.”

The CBDC will be controlled by the People’s Bank of China and be completely backed by the reserves paid to the institution by commercial institutions, reports Coin Telegraph.

The central bank made the statement on the progress of the digital currency within a conference dedicated to “studying and implementing the spirit” of the Fourth Plenary Session of the 19th Central Committee of the Communist Party of China, held in October last year, and December’s annual Central Economic Work Conference.

The conference reviewed the work undertaken by the People’s Bank of China last year and set out the bank’s main tasks in developing “socialism with Chinese characteristics” in 2020. 

The bank’s job for this year, with the backing of the Party Central Committee and the State Council, will include making “countercyclical adjustments” to monetary policy, confronting financial risks, and advancing with an ongoing liberalisation of the national economy.