PBoC dismisses talk of ‘imminent’ China cryptocurrency launch

PBoC dismisses talk of ‘imminent’ China cryptocurrency launch

The People’s Bank of China (PBoc) has dismissed talk of an imminent launch of its new cryptocurrency, citing the need for more time to address outstanding regulatory issues, state media outlet Xinhua reported.

The central bank had previously said its sovereign digital cryptocurrency was “almost ready,” leading to speculation in local press that it could be launched as soon as November. In fact, November 11 had been identified by some commentators as a potential date for the launch, coinciding with China’s Single’s Day, one of the busiest online shopping dates in the calendar.

However, the governor of the People’s Bank of China, Yi Gang, doused any further speculation in comments made at a press conference in Beijing, telling reporters the project did not “have a timetable.”

Development activity would continue, he said, in order to allow time for more work on “research, testing, trials, assessments and risk prevention.”

If the [sovereign] digital currency involves cross-border use, it will involve a series of regulatory issues regarding anti-money-laundering, anti-terrorism financing, anti-tax evasion as well as know-your-client protocols.

China is the first of the world’s major economies to begin work developing a state-backed stablecoin. Work has been underway since 2016, when the bank set up a dedicated research institute to explore the technology and how a fiat-backed stablecoin would work in practice.

Since then, the PBoC has acquired numerous patents covering elements and applications of its technology, yet has remained tight lipped on the specifics of the development work around their cryptocurrency.

Development activity appeared to speed up following the announcement of Facebook’s Libra last spring, and there have been suggestions of an approaching launch for China’s central bank ever since.

The PBoC has said that in time, the cryptocurrency will have the same legitimacy as current yuan banknotes, with the bank expecting digital transactions to replace fiat notes altogether in time.

With the news appearing to contradict recent speculation around the launch of the cryptocurrency, it looks as though the world will have to wait a while longer for China’s cryptocurrency. When it does eventually go live, the launch will be watched with keen interest from central banks elsewhere, with institutions in a number of countries reported to be considering similar proposals. 

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