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Chinese central bank tests digital currency system

26 January 2017  |  13401 views  |  0 Chinese flag

The People’s Bank of China (PBOC) has completed a successful trial run of a digital bank acceptance exchange, moving it closer to becoming the first central bank in the world to research and test its own digital currency, according to media agency Caixin.

Citing sources from the PBOC, Caixin says the central bank on Dec. 15 completed the trial in transactions and settlements of bank acceptance bills using a digital currency it developed.

The tests were run with the participation of several commercial banks, including the Industrial and Commercial Bank of China, Bank of China and the private WeBank, the sources said.

Taking the next steps, the Bank plans to set up a digital currency research institute, staffed by experts in developing big-data systems, cryptography, and blockchain technology.

When the system is ready, the central bank’s pilot digital bank acceptance exchange platform will be connected with the existing Shanghai Commercial Paper Exchange to form a national platform for bank bill transactions, said a person close to the central bank.

In previous discussions on the subject, the PBOC has inferred that China's digital money will be legal tender backed by the central government, and will enter circulation alongside traditional paper bills.

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