The newest development in China’s economy is the possibility of establishing a Beijing-based digital asset exchange for promoting the use of Digital Yuan.
The willingness to bolster financial services in Beijing has possibly prompted authorities to open a digital asset exchange, as implied by the State Council guidelines, reports Bloomberg. Though the government wants to accelerate China’s Digital Yuan trials by calling on financial heavyweights to set up e-CNY operational enterprises, the details of the planned digital asset exchange are still unclear and remain undisclosed.
The country has plenty on its plate, trying to juggle between regulating the crypto industry through completely abolishing mining and providing centralized digital yuan as an alternate choice to the decentralized nature of cryptocurrencies. Aside from maintaining eco-friendly standards, the most powerful motivation of China to crackdown on cryptocurrencies was to protect users from the unregulated and decentralized nature of the crypto market.
Nonetheless, the first CBDC scam hit the country in early November, where the response of the Chinese authorities was to arrest 11 suspects that allegedly laundered money through digital Yuan in the Fujian Province. The declaration of the Chinese authorities revealed that the suspects laundered money for a fraud group for Cambodia via the CBDC.
In light of this occurrence, the public was reassured by the Chinese authorities that this is merely an isolated incidence and improvements for protection and anti-counterfeiting elements of Digital Yuan are already underway to guarantee that such a scam will not happen again. The authorities also promised to improve the Digital Yuan’s compliance with the payment systems available.
Moreover, the CBDC trials will certainly not be stopped by the Chinese authorities, especially with the latest tightening of the security system. Speaking for an event organized by the Bank of Finland, Yi Gang, the PBOC governor stated that there are plans in the works for enhancing the usability and design of the digital Yuan, reinforcing the dedication of China to make this a widely accepted practice. “Going forward, we will continue to prudently advance R&D of eCNY, improve its design and use.”, stated Yi, once again reaffirming the country’s stance towards the decentralized structure of cryptocurrencies and all that comes with it.