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A senior official from the People’s Bank of China has said that their own digital asset is close to being ready for launch. China has been working on a central bank-controlled cryptocurrency for five years as a way to counteract the decentralized power of Bitcoin and others.

The Socialist nation was one of the first countries to clamp down on the cryptocurrency space. They initiated blanket bans of ICOs, not to mention their attempts to squash access to cryptocurrencies through banning access to exchanges. 

Part of their reason for stamping down on the global decentralized currency revolution was to protect their citizens from financial risk, however, it also appears that this effective banning has allowed them rather keep up with the technology revolution of blockchain, but with their own token.

China’s launch of this digital currency also appears to be a reaction to the quick turn around in Facebook trying to launch its own coin, Libra. This plan to have a global digital currency controlled by a company sent ripple through the central banks, including China’s, who feel any money should be bank controlled.

A new asset

Mu Changchun, deputy director of the PBOC’s payments department, said at an event held by China Finance 40 Forum over the weekend in Yichun, Heilongjiang, that the cryptocurrency is “close to being out,”

There was no timeline as to when it would be operational, but looking back at the patents filed by the PBoC, it appears that the currency will operate in a similar way yo any other cryptocurrency.

Citizens will download a mobile wallet which will allow them to trade their Yuan currency for this digital currency - which will be useable as a means of payment. However, unlike cash, this new digital asset which is intended to replace cash, could be monitored by the bank as keep tabs on any and all transactions. 

The aim of this new token is to make payments more digital, which is in line with the movement of the global financial system which are moving away from cash. So, it is a big and progressive step from the Chinese, but one that is allowing them even more control than before. 

Blockchain over Bitcoin

China has always said that it is a fan of blockchain technology and the potential that can bring to all sorts of sectors, but when it came to finance, the associated tokenomics of Bitcoin and its decentralized finance was opposed to their ways. 

In fact, their president has labeled it as an integral technology in the race to the fourth industrial revolution, and furthermore, they are probably leading the race in terms of blockchain innovation - all without focusing on decentralized digital currencies. 

However, they have been working on tokens and that side of things, but just in their own scope in order to have full control. It may not be cryptocurrencies like many in the West know and understand, but it is still a big step for China and the advancement of the technology. 

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