The People’s Bank of China, the central bank of the country, has just published the whitepaper of the e-CNY, the digital version of the yuan.
The document, which has been published today, confirms the official launch of the CBDC will take place soon, however, it does not provide a roadmap or a launch date. According to the whitepaper, the e-CNY has been designed to be programmable with smart contract features.
The Chinese central bank started its research on the digital yuan in 2014. However, according to the regulators, it was not until the emergence of cryptocurrencies that it become evident it was necessary to develop such currency to fight the risks and challenges cryptocurrencies represent for the traditional financial system.
The whitepaper reads:
“Bitcoin and other cryptocurrencies adopting blockchain and cryptography technologies claim to be ‘decentralized,’ ‘fully decentralized’ while they lack intrinsic values, are highly volatile, have low transaction efficiency and consumes an enormous amount of energy. These limitations prevented them from becoming a currency.”
We should remember that China has already carried out multiple trials of the uses of the digital yuan in real situations. In some of them, the citizens of different provinces of the country received free units of the e-CNY that could be used to pay for goods and services in participanting stores.