The landing of legal digital currency is accelerating.
On August 21, the central bank's WeChat public account published two articles, and then talked about digital currency: one is that Vice President Fan Yifei talked about the central bank's digital currency; the other is the deputy director of the central bank's payment and settlement division, Mu Changchun, in China's financial four. A speech on digital currency at the Yichun Forum of Ten People.
This is also the third time the central bank talked about digital currency this month: On August 2, the central bank said at the video conference in the second half of 2019 that it will speed up the pace of research and development of legal digital currency; August 10, Mu Changchun in China Finance IV The ten-person Yichun Forum said that "the central bank's digital currency can be said to be ready to go."
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On August 18th, the CPC Central Committee and the State Council issued the "Opinions on Supporting Shenzhen's Pioneering Demonstration Zone with Chinese Characteristics", and mentioned the support for the innovative application of digital currency research and mobile payment in Shenzhen. China's legal digital currency shows signs of accelerating landing.
"From a global perspective, legal digital currency issuance is a major trend in the digital economy, and central banks are studying." Wu Changhai, professor of the Institute of Capital Finance of China University of Political Science and Law and director of the Network Economy Research Center, interviewed by the Times Weekly reporter. At the time, however, there are still three major difficulties to overcome in the introduction of domestic digital currency: "One is whether technology is fully mature, the second is how to control the cross-border flow of digital currency, and the third is how to achieve supervision of illegal activities of the renminbi."
For the timing of the launch, “the current central bank’s voice on digital currency is still a framework and direction. The final timing of the central bank’s digital currency may still have to wait.” Cai Kailong, a senior researcher at the Institute of Financial Technology of Renmin University of China, pointed out to the Times Weekly reporter. .
Goal: Replace mobile cash
Although electronic payment has become the "new four major inventions", the central bank's legal digital currency is still necessary.
“As a substitute for M0, the relationship between central bank digital currency and mobile payment is more like a parallel relationship than a substitute relationship.” Cai Kailong said in an interview with Time Weekly that electronic payment in the traditional sense is more dependent on the account system and different operations. There is a barrier to transfer between the party's e-wallets, and the ability to prevent tampering is also weak.
"For the common people, the basic payment function is relatively vague between the electronic payment and the central bank's digital currency, but the central bank's future digital currency will be very different from electronic payment in some functions." Mu Changchun In the speech of the 40-member Yichun Forum of China's financial industry, the central bank's digital currency is actually used for the high-frequency business scenarios of small-scale retail. Therefore, the central bank in the design of the legal digital currency not only maintains the attributes and main features of the cash, but also meets the needs of portability and anonymity.
In the view of Yuan Yuming, dean of the China National Blockchain Research Institute, the central bank's digital currency and mobile payment functions are similar from the perspective of small retail payment scenarios and users, but the two are not substitutes: The central bank's digital currency can better control the flow of money; on the other hand, it can also transfer value from the bank account, allowing users to directly conduct anonymous and controllable transactions.
“The central bank’s former governor Zhou Xiaochuan once pointed out that studying digital currency is essentially the pursuit of convenience, speed and low cost of the retail payment system.” A regulator who is not willing to be named pointed out to the Times Weekly reporter that the digital currency The core is neither the current popular electronic payment nor the “reintegration of the existing RMB system”. “The key is to create a new, encrypted electronic money system that is alternative to mobile cash.”
As the key to the implementation of the policy, how to build a regulatory system has become the focus of the market on digital currency.
In response, the Vice President of the Central Bank, Fan Yifei, said that in the case of the two-tier operating system, China's central bank digital currency should adhere to a centralized management model.
The so-called double-tier operation refers to a single-tier operation system different from the central bank directly issuing digital currency to the public. The central bank converts digital currency to banks or other operating agencies, and then these institutions are exchanged for the public, thus forming a "central bank-business." The two-tier operating model of the organization.
“The two-tier operation mode can avoid the risk of being too concentrated on a single financial institution.” Cai Kailong pointed out to Time Weekly that the use of a two-tier structure not only adheres to the centralized management model of the central bank’s digital currency, but also brings digital currency The risk is scattered.
"The legal digital currency is a substitute for banknotes and is issued by the central bank. The general encrypted digital currency itself does not have a monetary function." Wu Changhai stressed that the government cannot hand over the currency distribution rights to enterprises, and decentralize the legal digital currency. It has not been possible for a long time.
Digital currency test field or settled in Shenzhen
The "Opinions of the CPC Central Committee and the State Council on Supporting Shenzhen's Pioneering Demonstration Zone with Chinese Characteristics" recently announced clearly, "supporting the innovative application of digital currency research and mobile payment in Shenzhen."
Cai Kailong, a senior researcher at the Institute of Financial Technology of Renmin University of China, believes that similar to Singapore’s allowing digital currency to enter the “sandbox”, the “sandbox” of domestic digital currency landing is likely to land in Shenzhen.
“Shenzhen has developed many industries in the process of reform and opening up, and has gathered a large number of high-tech enterprises such as Huawei in the fields of high-tech, Internet, and communications, representing the foundation of a new generation of R&D technology.” Associate School of Finance and Finance College, Renmin University of China Zhao Xijun said that Shenzhen is not only the most prosperous area for domestic high-tech development, but also a financial center. “In this sense, Shenzhen has the foundation and the corresponding ability to carry out research and exploration combining finance and technology.”
In fact, the history of Shenzhen as a digital currency research and development base began in 2018: In that year, the Central Bank Digital Money Research Institute, which carried out digital currency research and promoted the development of financial undertakings, invested 2 million yuan to set up Shenzhen Financial Technology Co., Ltd. This is also the only financial technology technology development company wholly owned by the Central Bank Digital Currency Research Institute.
According to the Times Weekly reporters' data, on August 9th, Shenzhen Financial Science and Technology Research Institute announced 31 recruitment positions on a recruitment website, including engineers and researchers, and is still in the process of recruiting.
"The establishment of a financial technology company in Shenzhen by the Central Bank Digital Currency Institute can also reflect the tendency of digital currency to take the lead in Shenzhen." Lin Jiang, a professor at Lingnan College of Sun Yat-sen University, pointed out to the reporter of Time Weekly that the popular basis of the central bank's digital currency. It is mobile payment, and Shenzhen has a very good user and technical foundation. If the legal digital currency can be first established in Shenzhen, it will play an important role in promoting the internationalization of the RMB and the coordinated development of the industry in Dawan District.
Source: Times Weekly
Author: Wang Xinhao