The People's Bank of China already has its cryptocurrency

After five years of research, the People's Bank of China (PBoC) announced that it had completed work on creation kryptowalutybased on blockchain. This is a prototype for now, but the Chinese do not hide that they intend to give their citizens a native alternative on the cryptocurrency market as soon as possible.

The Chinese have been working on the digital currency since 2014. Although initially these were mainly conceptual activities, but after the successes of subsequent cryptocurrencies, the activities were intensified. They accelerated even more when it turned out that Facebook was doing advanced work on Libra. And even despite the loud protests of some politicians and representatives of central banks, there are many indications that in a year or two LibraCoin will be operational.

Read more: Facebook is still fighting and Libra

In China, there will certainly be no problems with the central bank, because work on the cryptocurrency was carried out from the beginning under the supervision of the government. During the China Finance 40 Forum, we got to know the details provided by the Chinese news agency Xinhua.

Chinese cryptocurrency - details

The cryptocurrency is to be used, among others for retail payments, so it will ensure a high frequency of transactions. Until now, the problem of e.g. Bitcoin was - contrary to appearances - the possibility of a large number of transactions at the same time. Traditional payment networks - such as Visa or Mastercard - beat him in this respect. The technology developed by the Chinese is meant to solve this problem once and for all. However, there are also problems indicated by people working on its implementation and coordinating the work of IT specialists.

"The issuance of cryptocurrencies itself will be difficult in China, which is a huge country. Especially because we will base the digital currency on a two-tier operating system, which is necessary in a country with such a large territory, population and complex economy " - says Mu Changchun, deputy director of the People's Bank of China (PBoC).

The People's Bank of China will be the issuer of the digital currency. Commercial banks will also be able to distribute it in the future, but they will all act as intermediaries.

The US and Chinese trade war also in the field of cryptocurrency

A cryptocurrency being developed by China may be the first in the world to be prepared by national authorities. All the initiatives that have been operating so far are definitely bottom-up initiatives. This can further confuse the US-China economic and political relationship, which has been so tense in recent months, which is already waging an open "trade war". In addition to increasingly higher tariffs on new types of products, accusations of picking up ideas and economic and economic espionage, they may now be joined by another reason, which will be convenient and common cryptocurrency.

The US authorities do not like the rapid progress in work on the increasingly common cryptocurrencies. President Donald Trump even claims that they mainly serve criminals and terrorist financing, and LibraCoin, which is being finalized by Facebook giants, is even threatening the dollar and the entire United States.

When is the debut of Chinese cryptocurrency?

Will it be similar with Chinese cryptocurrency? Politicians from outside China do not comment yet, even though it is not even known how much time they have. Although the Chinese do not provide a specific date for the issue of new digital means of payment, no one should be surprised if they appear on the market faster than the recently exposed Libra. Unofficially, you can hear that the Chinese cryptocurrency debut is expected even in the next few months.