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China's Central Bank Touts Digital Fiat Currency

By Wang Liwei and Dong Tongjain
The director of China's central bank's digital currency research institute said encryption would be key to any future digital fiat currency but that this need not be based on blockchain technology. Photo: Visual China
The director of China's central bank's digital currency research institute said encryption would be key to any future digital fiat currency but that this need not be based on blockchain technology. Photo: Visual China

A digital fiat currency would need to be able to stabilize its own value, guard against data breaches, and facilitate transactions and smart living for users, regardless of whether blockchains are used, officials from China’s central bank said.

The boom in cryptocurrencies, which shut out governments in China and elsewhere, is too big to ignore. Since 2014, the People’s Bank of China (PBOC) has been exploring a central bank-backed alternative — a digital fiat currency that has the same legal status and is subject to the same regulatory oversight as physical notes and coins. Last year, the central bank gave its explicit support for dematerialized money, adding its experts were working on a general framework with Citibank and Deloitte.

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