As China’s CBDC (Central Bank Digital Currency) undergoes technological and business model changes, the market should open up the possibility of incorporating CBDC or digital Yuan into all online retail payment modes, Changchun Mu (Founder and Director of PBC’s Digital Currency Research Institute) said on the 3rd of September, 2023.
Mu emphasized the need for digital Yuan developers to have the digital currency readily available in all retail contexts during his speech at the China International Services Trade Fair. The official stated that the Chinese CBDC (known as the Renminbi) has undergone a significant upgrade in terms of “organizational forms” and business model, and now it is time to upgrade the payment tools.
Mu drew attention to the presence of commercial banks’ applications and platforms such as WeChat, Alipay and reminded them of their regulatory obligations. The short-term focus can be on the implementation of QR codes for the CBDC or digital Yuan, while the long-term objective is to modernize the payment tools.
The official also raised the question of wholesale payments. Mu said that it is not necessary to completely replace the current interbank payment and settlement system. The official said that the only thing that needs to be done is to integrate the payment option of the CBDC into the system. However, the official did not mention any technical details about such integration during the speech.
China is continuing its work on blockchain-backed, but fully managed, digital infrastructure. Earlier this month, the Chinese government announced a new blockchain-based data exchange in Hangzhou. This new data exchange, called the “Hangzhou Data Exchange,” will make it easier to share corporate IT data using distributed ledger technology.
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