China’s central bank said it is studying the prospects of issuing its own digital currency and aiming to roll out a product as soon as possible, contending that alternative payment systems can improve the efficiency of global transactions.
The People’s Bank of China set up a research team in 2014 to study digital currencies and application scenarios, according to a statement posted on the regulator’s website. The PBOC said it has consulted with experts from Citigroup Inc. and Deloitte LLP, though it didn’t specify what technology it would be using to issue its digital currency or how it would work in relation to the yuan.
Digital currencies have gained prominence with the rise of bitcoin, which is mined with high-powered computers and operates with a distributed ledger that contains the payment history of every circulation. China has become one of the biggest markets for bitcoin and miners, as Chinese regulators have largely taken a hands-off approach with bitcoin exchanges and businesses.
“They’ve recognized the opportunities the digital currencies have,” said Zennon Kapron, managing director of Shanghai-based consulting firm Kapronasia. “If they did have something the government could monitor and use, that could fit into their longer-term plans.”
An estimated $843 billion of capital