People’s Bank Of China: Planned Digital Currency?
The People’s Bank of China (“Bank”) has been filing an array of patent applications – 40 of them to be exact, for the purpose of creating a digital currency that combines the key features of crypto and the existing monetary system. The patent applications have features of digital currencies, such as a wallet for stores and transactions.
The technology works in an “end-to-end” manner. The digital wallet may make it easier for users to review transactions that are conducted through the service and it may also be able to facilitate the transaction process as well. In a statement released by the Bank, it stated that its main goal is to
“break the silo between blockchain-based cryptocurrency and the existing monetary system.”
This process may allow the digital currency to include cryptocurrency-like features, while still being used in the traditional financial system.
Further, the wallet is meant to operate without limits. It may be able to store digital currency that is issued by the central blank or an authorized financial entity encrypted like a cryptocurrency. It could include private keys and offer multi-signature security features in a decentralized fashion.
The patent applications and the effort on the Bank’s behalf show that it is making the effort to develop a digital currency that may have a strong role in its future and among other financial institutions. The Bank’s research lab released a statement, saying
“The virtual currencies issued by private entities are fundamental flaws given their volatility, low public trust, and limited useable scope … Therefore, it’s inevitable for the central bank to launch its own digital currency to upscale the existing circulation of the fiat currency.”