The governor of the People’s Bank of China (PBOC) Yi Gang, has put a damper in the general idea that China will launch its national digital currency soon. According to Gang, there is currently no plan at all for an official launch of a digital yuan.
Speaking with Financial Times and China Finance as revealed by the PBoC, Gang specifies that China’s apex bank is not currently planning a launch. The governor says even though China is currently running pilot tests of the digital yuan, the general public should not take the tests as evidence that there will soon be a publicly available digital yuan.
According to him, the tests are merely “routine work in the research and development process…[and] there is no timetable for when it will be officially launched.”
Back in April, China began testing its central bank digital currency (CBDC) in four cities in the county, including Xiongan, Shenzhen, Chengdu, and Suzhou. In Suzhou’s Xiangcheng District, the tests began with transport subsidies.
Workers at a few agencies in the district began to receive these subsidies in the CBDC. The tests are also being run by four major Chinese banks, including the Industrial and Commercial Bank of China, the Agricultural Bank of China, the Bank of China, and the China Construction Bank.
Even though there’s no timetable, Gang believes that the digital yuan is a step in the right direction. Speaking in the interview, the central bank governor said the digital yuan is a good way to satisfy public demand for the currency, especially as the economy is progressively turning digital.
China is said to have accelerated research and development into its digital currency, because of the early threat of Facebook’s Libra. However, apart from the Libra, the digital yuan might be a great way for China to maintain more independence from the power and control of the dollar, especially with international trade.
Even as Gang has said there is no timetable, there still is a good chance that China could float the CBDC sooner than thought, if the U.S. plans a counter move.
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