On August 31, 2017 the Financial Times reported how Barclays, Credit Suisse, Canadian Imperial Bank of Commerce, HSBC, MUFG, and State Street have joined forced to work on the “utility settlement coin”, a digital coin that will make transactions on the financial market more efficient. The utility settlement coin, however, would become obsolete if central banks issued their own digital currency.
The option to issue its own digital currency has been considered by the People’s Bank of China, at least since 2016. The following 2,250-words article was published on the official website of the Legal Daily in 2016. It provides a generic description of some of the steps the People’s Bank of China has been taking to prepare to issue its own digital currency, at a time when mobile payments are already quickly replacing cash, and there is a consensus that digital currency will help the construction of a social credit system.
(…) Digital currency is still at the research stage, and the stage of distribution may still be very far. Further efforts in such fields as theory and technology are still needed. The central bank needs several matching systems to issue digital currency, which may take a long process. If the central bank will start to issue digital currency in the future, existing laws, regulations and rules in the financial sector will need to be revised. Digital currency it is furthermore of broad concern to society.
Recently, the Printing Science and Technology Research Institute of the People’s Bank of China published a recruitment notice aimed at recruiting “Digital currency research and development technology personnel”. This year, in a series of surprising moves, the People’s Bank of China has held a digital currency seminar to prepare the creation of the Digital Currency Research Institute, which includes the recruitment of “digital currency research and development technology personnel”. (…)