New Tencent Survey Shows Top Economists in China are Torn on Central Bank Digital Currency (CBDCs)
According to a recent survey that was conducted by Tencent’s fintech think tank, top economists in China are divided about Central Bank Digital Currencies (CBDCs) and their effect on the economy. Some of them believe that the effects could be very positive, while others think that they would have a negative influence.
According to Jiemian news, the survey conducted by Tencent included 103 chief economists in several companies and university professors. Central Bank Digital Currencies have been analyzed by several financial institutions and banks all over the world. Although there are no implementations related to CBDCs, analysts are still not convinced about the positive effects they would have on the economy.
Regarding blockchain technology, 33% of the respondents said they have a positive stance towards the development of this technology. 32% mentioned that they do not believe that distributed ledger technology (DLT) is not as revolutionary as some individuals believe it is. 19% said that DLT may not play an important role in the world.
There are several companies that are starting to work with blockchain technology. Furthermore, some countries are also starting to modify their legal frameworks to welcome more cryptocurrency and blockchain-related companies. Some of these nations are Switzerland and Malta, among others.
Tencent discovered that 40% of the economist in China believe that the People’s Bank of China (PBoC) should not issue a CBDC. Meanwhile, 51% of the respondents said that they support this possibility.
There are several reports that show that China could eventually release its own CBDC. The country is also working in a system to have the credit history of each of its citizens. This would China to have a larger control over its population. Another possibility was to create a yuan-backed stablecoin such as other fiat-backed virtual currencies that are currently operating in the market.
A yuan-backed stablecoin is similar to what other central banks around the world are trying to do. For example, Ukraine, Sweden, and Uruguay have been analyzing the possibility to issue their own digital fiat currencies. Although they all have different ideas about what they are trying to improve with these digital assets, this shows that a digital coin can play an important role in the economy.
Other countries that are currently investigating the effects of launching a CBDC are the United Kingdom, Sweden, Canada, Uruguay, and Ukraine, among others.