Follow Us

Chinese central bank has published its first digital yuan whitepaper

Share on facebook
Share on twitter
Share on linkedin

Share

Electronic Yuan!
Share on facebook
Share on twitter
Share on linkedin
  • Digital yuan whitepaper has been released by the People’s Bank of China
  • The paper confirms that the digital form of their government-issued currency is designed to be programmable with smart contracts features
  • The whitepaper describes the background, features, and performance of the e-CNY initiative
  • The central bank believes that crypto assets are mostly speculative instruments
  • PBoC mentioned that the use of fiat-pegged crypto coins could tackle volatility

The Digital yuan has been rolled out by the Chinese central bank. The national digital currency’s issuance has helped the country to lead. Recently, the government has issued its central bank digital currency (CBDC) whitepaper. Moreover, the nation has confirmed the smart contracts’ programmability. The whitepaper of the e-CNY was published on Friday, containing all details regarding the background, features, and performance of digital yuan. Moreover, lawmakers have noted that such currencies lack intrinsic value, acute price fluctuations, low trading efficiencies, massive energy consumption, and more.

Issuance of digital yuan whitepaper

The recently issued whitepaper by the Chinese authorities has been dubbed as the e-CNY. Significantly, the paper confirms that the digital form of their government-issued currency is designed to be programmable with smart contracts features. However, the whitepaper has not set any concrete roadmap for an official launch by the People’s Bank of China (PBoC).

What does the whitepaper describe?

The latest released digital yuan whitepaper describes the background, features, and performance of the e-CNY initiative. The digital currency initiative began in 2014. The Chinese central bank noted that digital currencies like Bitcoin and Ethereum are considered decentralized by adopting blockchain and encryption technology. And these things are entirely anonymous.

What does the government think of Bitcoin?

China said that cryptocurrencies and the underlying technology lack intrinsic value and have acute price fluctuation. Moreover, these decentralized materials have low trading efficiencies and colossal consumption. Hence, these assets can hardly serve as a currency for daily economic activities. 

Simultaneously, the central bank believes that crypto assets are mostly speculative instruments and therefore pose potential risks to financial security and social stability. Hence, the whitepaper also mentioned that the use of fiat-pegged crypto coins could tackle volatility.

Stablecoins can tackle volatility

The Chinese central bank noted that to tackle the relative big price fluctuation concern of digital assets, some private firms have issued stablecoins. In addition, the firms tried to stabilize their values by pegging them to sovereign currencies or some related assets by introducing such currencies.

It is also observed that few of the commercial firms are planning to launch global stablecoins. Indeed, such issuance would bring risks and challenges to the international monetary ecosystem, payments, clearances, policies, cross-border capital flow management, and other stuff.

Smart contracts programmability is a significant feature

The digital yuan whitepaper consisted of details about the design characteristics. We have observed that the smart contracts programmability is one of the prominent features. The central bank addressed that the digital yuan obtains programmatically from deploying smart contracts that don’t impair its monetary functions. In terms of security and compliance, such features enable self-executing payments as per predefined conditions or terms agreed from both sides.

Leave a Reply

Your email address will not be published. Required fields are marked *

Download our App for getting faster updates at your fingertips.

en_badge_web_generic.b07819ff-300x116-1

We Recommend

Top Rated Cryptocurrency Exchange

-
00:00
00:00
Update Required Flash plugin
-
00:00
00:00