Ex-China Central Bank Governor Talks About Upcoming Digital Yuan and Its Benefits
The current president of the Chinese Finance Association, Zhou Xiaochuan, has recently talked about the upcoming digital yuan. According to the economist, who has worked as the former head of the People’s Bank of China, the country’s central bank, China will continue on its path to create a digital yuan to be used for both retail and international transactions.
He has recently discussed the influence that global banks can have in creating digital currencies and believes that the most economically powerful nations should be cautious when approaching this new technology. Taking a pragmatic approach when deciding what to do with its sovereign currencies is a good idea, in his opinion, because they are very important.
Xiaochuan defends the idea that any bad decision can be really catastrophic to a country and it could lead to people losing all their trust in their national currency, which would start a financial crisis that would destroy the economy. He defends that national fiat currencies are a symbol of national sovereignty and they should be protected, so no rushed decisions can be taken.
According to the economist, implementing this new system has two main goals. One of them is to create a digital payment to support retail payments in the country. The other one is to expand on international settlements using this new digital currency.
Xiaochuan points out that digital currencies should be studies in-depth and that they can bring many opportunities to the industry if they are well regulated.
China will release its new digital yuan “soon” and the world will be a different place after that. We can only wait and see how the financial system will be affected by this change.