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Tuesday, Jul 07, 2020

Coronavirus hampers digital yuan research

Coronavirus hampers digital yuan research

As China is about to introduce a digital version of its yuan currency, research on China’s digital yuan has been hampered by the deadly coronavirus epidemic sweeping the country.
The epidemic’s impact on staff working on the central bank digital currency (CBDC) project has resulted in significant setbacks.

A source familiar with the matter reportedly said: “The coronavirus outbreak has led to postponed work resumption in government institutions, including the People’s Bank of China. Policymakers and research staff involved in the DCEP [Digital Currency Electronic Payment] project are no exception, which weighs on the development process.”

Shentu Qingchun, the CEO of Shenzhen-based blockchain company BankLedger – which is involved in the project – said that the central bank was expected to make an important announcement during Q1 2020, Cointelegraph reported.

He noted that there is just one month left in the quarter, “so chances that the announcement could be made on time are slim.”

Cao Yin, a blockchain researcher at the Yangtze Delta Region Institute of Tsinghua University, said he expects the launch of the CBDC to still happen this year. He explained that China “has been preparing for the launch both technologically and theoretically for a long time” and the roadmap is already in place. Cao also suggested that the central bank’s digital currency team has sufficient staff to make up for the delay.

The coronavirus has had a considerable impact on the blockchain and cryptocurrency industry so far. As Cointelegraph reported earlier this month, a number of cryptocurrency-related conferences across Asia are being delayed in response to the outbreak.

More recent reports also suggest that China has turned to blockchain technology to manage medical data, track the supply of virus prevention materials and consult the public amid the epidemic.

Last month, the central bank said the digital yuan was “progressing smoothly” and that its “top-level” design had been completed, Yahoo Finance reported.

China’s much-anticipated digital yuan will be first distributed to commercial banks and then users, and businesses can register digital wallets with these commercial banks. The first cities to pilot digital currency are believed to be Shenzhen and Suzhou.
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