A former People’s Bank of China (PBoC) official has defended China by clarifying his motivations behind the development of the digital yuan as the central bank’s digital currency (CBDC).
Yao Qian, former director of the digital currency institute at the PBoC, denied that the digital yuan was intended as a surveillance tool.
He reportedly clarified that China decided to develop the digital yuan as a countermeasure against the increasingly popular “private payment platforms”.
Concerns about the digital yuan
Yao made the remarks while participating in a panel at the Beijing International Finance Forum.
His comments argue against claims made by US Federal Reserve Chairman Jerome Powell at a press conference on April 28.
Powell indicated that such a digital currency would not work in the United States and claimed that the digital yuan allowed the Chinese government to “see each payment” that is made, for which it is used in real time ”.
Yao insisted that this was not the case, arguing that A CBDC is necessary for central banks to innovate fiat currencies amid the digital boom.
The digital yuan has been the subject of much debate since its initial announcement. Many have questioned the effects it will have on industries, such as gambling operators in Macau.
United States officials also They have expressed concern that it could undermine the dollar’s dominance.
In April, reports revealed that the Biden administration was monitoring the development of the CBDC.
However, in May, Hester Peirce, commissioner of the U.S. Securities and Exchange Commission (SEC), stated that the digital yuan will not outshine the dollar.
SEC crypto mom
The world gravitates towards CBDC
China is not the only one with a commitment to a CBDC. The month of May has been especially hectic.
Nations like Canada and South Africa have continued to push their respective versions of digital currency.
Meanwhile, Sweden’s central bank has already started working towards its next CBDC testing phase.
In addition, the central bank of South Korea has launched plans to test its own digital currency.
In total, according to a report by the Bank for International Settlements, 80% of the world’s central banks were already conceptualizing and researching CBDCs at the beginning of the year.
The report was further developed to claim that 40% of them were building proofs-of-concept (proofs of concept, in Spanish) and 10% were implementing their pilot projects.
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