Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
The DCEP pilot test has been largely successful while making specific assertions with respect to the ongoing trials.
China’s pilot Central Bank Digital Currency, also known as the Digital Currency Electronic Payments (DCEP), has witnessed about 4 million transactions thus far since the pilot test commenced in four cities including Shenzhen, Chengdu, Suzhou, and Xiongan. Per a report by Bloomberg, the Governor of People’s Bank of China (PBOC) Yi Gang confirmed that these 4 million transactions are worth a total of 2 billion yuan (US$299 million) while on a Virtual Conference Panel with the General Manager of the Bank of International Settlement, Agustin Carstens, as well as Klaas Knot, president of the Dutch central bank.
Yi Gang believes that the DCEP pilot test has been largely successful while making specific assertions with respect to the ongoing DCEP trial. According to the governor, fintech companies have some unarguable advantages over commercial banks, particularly in terms of developing a customer base and managing risk. The governor also noted that the advent of emerging technologies being applied to financial applications such as microloans and mobile payments has increased accessibility to financial services in remote areas.
Gang also reiterated that the COVID-19 pandemic posed a challenge for Central Banks to develop novel ways to serve citizen’s growing demand for cash and monetary payments while also prioritizing their safety. This amongst many others is part of the reasons why China’s DCEP project increased its momentum in the past months in which it advanced into its testing phases. Lastly, Gang reiterated the importance of protecting the customer’s private information.
The number of Central Banks pursuing a Central Bank Digital Currency has increased in recent times with many advocating for collaboration in order to stem irregularities across the board
Potential Launch of China’s DCEP Project
There has been quite a lot of expectations with respect to the launch of China’s DCEP based on the leaps the PBOC has recorded during the trials which began in April this year.
There has been no indication of any imminent launch as Yi Gang noted that the testing though commended by many is still in its early stages. The governor also made a case for the lack of adequate or comprehensive regulations needed to support the DCEP once it is finally launched. For this, the PBoC governor said that there is still a need to create a “fairly complicated and fairly complete legal framework,” especially as it involves transparency.
China’s DCEP project is progressing in its efforts to perfect its model in which the People’s Bank of China mints the DCEP or digital Yuan and the licensed commercial banks will be responsible for distributing it to customers as is currently being done for the country’s fiat currency, the Yuan
The move to integrate the Digital Yuan across the board also saw Huawei Technologies Co Ltd integrate a digital yuan hardware wallet in its latest 5G enabled smartphone series, the Mate 40 as Coinspeaker earlier reported.