Most people tend to choose Alipay and WeChat to pay for their daily travel and shopping. In just a few years, the emergence of e-cash has changed people's lifestyles and increased payment efficiency.
From the development of natural currency such as physical and precious metals to artificial currency such as coinage and banknotes, to today's electronic payment method, the currency has been continuously developing and progressing.
On July 8, 2019, at the launching ceremony of the Digital Finance Open Research Program and the first academic seminar, Wang Xin, director of the Research Bureau of the People's Bank of China, revealed that the State Council has officially approved the research and development of the central bank's digital currency. Currently, the central bank is organizing market institutions to engage in corresponding activities. jobs.
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Today, let’s talk about what is the central bank’s digital currency (legal digital currency)?
The legal digital currency is a currency form issued by the central bank using specific digital cryptography. Mentioned here, many people may still not understand what the digital currency is?
Since Alipay and WeChat pay for money every day through digital changes, many people regard it as a digital currency. This is actually not true.
Alipay, WeChat payment and mobile banking are all electronic money. These are payment methods based on electronic accounts. It is just an electronic form of RMB and cannot be called digital currency .
Digital currency can be thought of as a virtual currency based on a node network and a digital encryption algorithm .
The digital currency represented by Bitcoin is circulated on the Internet in the form of numbers. There is no specific issuer, the total amount of money is fixed, and no third party is required to participate.
Subsequent to the competition coins such as Litecoin, Dogecoin, Ethereum, and Ripple, the blockchain technology based on the encryption algorithm is also called “Cryptocurrency”, but all belong to the digital currency. Type .
However, these coins have only been recognized and used by some people, and there are still some problems to be solved in daily circulation.
At the Singapore Financial Technology Festival on November 14, 2018, the head of the International Monetary Fund's IMF, Lagarde, believes that it is time for global central banks to explore the concept of issuing a legal digital currency. It is also time to consider the feasibility of a legal digital currency. Money can be funded for digital currency.
02 Significance of issuing legal digital currency
1. User experience level
First, the legal digital currency is different from third-party payment platforms such as Alipay and WeChat. It supports remote point-to-point payment. It does not require any third-party tools, which not only reduces the operating cost of money, but also improves the security of payment. The experience becomes smarter.
For example, Di Gang, deputy director of the Institute of Digital and Monetary Research of the People's Bank of China, said: "The future use of bank-directed loans can be traced back. The wallet is not necessarily based on bank accounts. For example, money is placed in the meter, and it is automatically recharged when the balance is insufficient. The car passes through a toll booth, and after GPS positioning, it can be realized through applications such as direct deduction of funds through smart contracts. Di Gang pointed out that since the intelligent currency is a functional currency, it is an upgrade of existing electronic payment tools, and this upgrade must be very competitive. force.
Secondly, the legal digital currency has the credit support of the state, and the stability of the system can protect the rights and interests of consumers.
2, the national level
The use of legal digital currency can not only maintain the national currency sovereignty, but also make the supervision of the financial order more convenient, adjust when the value fluctuations are too large, and be more open and transparent in tracking the flow of funds . For example, whether the poverty alleviation subsidies issued by the state are in place and the whereabouts of official corruption funds can be clearly recorded, which brings great convenience to the investigation.
In general, the distribution of legal digital currency outweighs the disadvantages. Of course, the legal digital currency may also face some security problems, but it is more secure through the central bank.
Which year do you estimate that China will issue legal digital currency? why? Feel free to share your opinion in the message area.
Author | Sanli
Produced|Baihua blockchain (ID: hellobtc)
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