The People’s Bank of China is “close” to issuing its own cryptocurrency, as the bank’s researchers have been working intensively since last year to develop systems, said Mu Changchun, deputy director of the PBoC’s payments department.
Mu repeated the central bank’s intention that the digital currency would replace M0, or cash in circulation, rather than M2, which would generate credit and impact monetary policy. The digital currency would also support the RMB’s circulation and internationalization, he said.
Facebook Inc.’s push to create cryptocurrency Libra has caused concerns among global central banks, including the PBoC, which said the digital asset must be put under central bank oversight to prevent potential foreign exchange risks and protect the authority of monetary policy, said Sun Tianqi, an official from China’s State Administration of Foreign Exchange.
According to patents registered by the central bank, consumers and businesses would download a mobile wallet and swap RMB for the digital money, which they could use to make and receive payments.