PBoC seeks to accelerate the pace of digital currency R&D this year

The People’s Bank of China (PBoC) has revealed its intention to accelerate the pace of the research and development of its digital currency in the forthcoming months.

The central bank held a video conference on August 02 for the second half of 2019. In an online post summarizing the key highlights, the PBoC said the meeting aimed to convey the Party Central Committee and the State Council on economic and financial work, summarize the work in the first half of the year, analyze the current domestic and international economic and financial situation, and study and deploy the key tasks in the second half of the year.

Among other things, the central bank wants to develop financial technology (fintech) with the objective of meeting new challenges. It also wants to hasten the research and development process of its own digital currency as well as study the trend of virtual currency at both domestic and international markets.

“Accelerate the pace of research and development of China's legal digital currency (DC/EP), track and study the development trend of virtual currency at home and abroad, and continue to strengthen Internet financial risk remediation,” the online post reads (via online translation).

The PBoC reportedly started exploring digital currencies back in 2016 and completed a trial of a blockchain-based digital currency with commercial banks in December of that year. However, not many details about the ongoing development were revealed later.

The central bank also opened a research lab with a focus on blockchain, fintech, and digital currencies in 2017.

The PBoC’s renewed enthusiasm towards digital currency follows recent comments from the central bank’s research bureau director Wang Xin on Facebook’s Libra.

“If [Libra] is widely used for payments, cross-border payments in particular, would it be able to function like money and accordingly have a large influence on monetary policy, financial stability and the international monetary system?” Wang said.

“We had an early start … but lots of work is needed to consolidate our lead,”

Meanwhile, the Bank of Thailand (BOT) last month announced that its Project Inthanon is heading to the third phase. The project aims to explore the use of blockchain technology to improve the country’s financial infrastructure and create an ecosystem supportive of technological learning and advancement.