China has been discussing the potential of a national digital currency for half a century, and the Chinese digital yuan project, called Digital Currency Electronic Payments, or DCEP, has a long history. In 2014, the People’s Bank of China set up a research group “to study digital currencies and use cases”. The research team is researching digital currency and is reportedly considering issuing its own digital currency. In 2016, PBoC announced plans to develop its own digital currency and began hiring blockchain experts. That same year, China’s government included blockchain technology in its thirteenth five – year plan.
In 2017, the People’s Bank of China (PBoC) launched the Digital Currency Research Institute, which is dedicated to the development and research of digital currencies. According to the National Intellectual Property Office of China (officially known as the State Intellectual Property Office), the institute has filed more than 63 patent applications related to blockchain and cryptography in its first year alone. In 2018, a report from the China Institute of International Finance, monitored by the People’s Bank of China, indicated that the central bank would launch a campaign to regulate all types of digital currencies.
In July 2019, Wang Xin, research director at the People’s Bank of China, said that Facebook’s plan to launch its stable currency, Libra (now known as Dim), influenced China’s plans to launch a digital form of the Chinese yuan. … At the time, some experts speculated that the Chinese government-backed digital currency was targeted for distribution before the official launch of Libra.
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The DCEP project has made great strides over the past year; The details of the project were meanwhile limited. While the question of whether it will be the first to launch a central bank digital currency will be sufficient to achieve global reserve currency status remains open, it is clear that China is moving towards the supply chain in the digital economy.
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Only this year, China began testing the infrastructure for the digital yuan before its official launch, and the Chinese city of Shenzhen provided residents with the opportunity to participate in a lottery aimed at encouraging the introduction of the new digital currency in the country’s central bank. … Also this year, China completed the development of hardware wallets for the digital yuan project; The first was produced by the Xungang branch of the China Agricultural Bank in Hebei, and the second by the China Post Reserve Bank. And earlier in March, the Bank of Communications and China Construction Bank conducted digital tests of the yuan at two major stores in Shanghai.