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Over The Last Two Weeks The Chinese Central Bank Has Loudly Provided Plans On Launching A 'Digital Yuan' - The Bank Has Positioned The Product As A Competitor To Libra - Both Are Not Cryptocurrency
Over the weekend the Shanghai Securities news interviewed the new Head of the Digital Currency Research Institute in China, Changchun Mu. According to the report Mu published details on the new PBoC project. According to Mu, the digital yuan will has, 'functional attributes exactly the same as paper money but it is just a digital form.' While pointing out various, seemingly cosmetic, attributes that he claimed made the Chinese project superior to Libra, there did not appear to be a mention of blockchain or Distributed Ledger Technology.
Crypto Takeaway: It is particularly difficult to wrap one's head around what is hoping to be accomplished with this 'digital yuan.' There are already plenty of payment rails broadly used in China that allow for yuan transfers including WeChat pay and others. There has been noise out of the Central Bank community of nations creating their own 'digital currencies,' however, we struggle to identify what these plans add to the picture beyond existing electronic transfer systems.