PEJOURNAL – China’s central bank said it is seeking cross-border payments with the digital yuan and plans to introduce global standards for digital currencies (digital Yuan) to create a common international monetary system.
The Central Bank of China said it is strengthening information security and protecting personal data while developing the experimental use of the digital yuan at home.
China is leading the global competition for the central bank’s virtual currencies and has long tentatively used the digital yuan in the most major cities, including Shenzhen, Beijing and Shanghai, but has yet to announce any time for its official launch.
Many analysts believe that the digital yuan will strengthen the global position of the currency at a time when China is seeking to break the dominance of the dollar payment system.
“Globalization of currency is a natural result of market choice,” the central bank said. “Although the digital yuan is technically ready for cross-border use, its design is still suitable for domestic payments.”
“The bank said it was pursuing a cross-border payment program in cooperation with other central banks and hoped to be actively involved in international digital currency transfers and set standards for it to establish a common international monetary system.”
The digital yuan covers part of China’s banknotes and coins and uses a dual distribution system. In this system, the central bank offers digital currencies to banks, and banks deliver it to individuals and companies.
China’s central bank has vowed to protect individuals’ personal information and prevent the use of yuan digital in online betting, money laundering and tax evasion in an effort to reduce concerns about government oversight of digital currencies.
The yuan digital payment system requires less personal information than traditional systems and does not provide this information to the third parties or other government agencies.