Chinese Central Bank Is Accelerating Its CBDC Plan

As more and more countries around the world are combating the coronavirus and COVID-19 outbreak, China has had a change of plans. The central banks around the world are cutting the interest rates to zero amid the lockdown because of the virus, while the Chinese central bank is accelerating its central bank digital currency (CBDC) plan.

One report from Global Times issued on March 24 which is now viral in the regulation crypto news show that China is one step closer to issuing its own CBDC. The Bank of China recently completed the development of the basic functions of the official digital currency and is now drafting laws which will help its implementation.

The report also shows that the Chinese central bank is moving forward with the plans – and there are a number of Shenzhen-based private companies such as Alibaba, Tencent, Huawei and China Merchants Bank which are all participating in the development of the digital currency. According to some claims, these private companies were selected based on their rich blockchain and third-party payments experience.

For instance, the altcoin news before showed that Alibaba’s Alipay and Tencent’s WeChat pay together have more than 1.7 billion active accounts across the country – which is 300 million more than its population. This is where the major opportunity lies for the country and its official digital currency planning.

Alipay even publicized five patents related to the official digital currency offering between January 21 and March 17, covering several areas of digital currency such as issuance, transaction recording, digital wallets, anonymous trading support and assistance in supervising and dealing with illegal accounts.

That said, the Chinese central bank could accelerate and push the CBDC adoption in a better way soon and help turn a crisis into an opportunity. Now, cryptocurrency is seen as the most convenient tool to translate a central bank’s zero and negative interest rate policy into commercial banks.

Previously, we reported about China’s plans to implement the digital Yuan among countries that are involved in its Belt and Road initiative. All in all, the country sees the issuance of a central bank digital currency (CBDC) as an important strategy that will give China an additional advantage in international economic development.