China’s upcoming digital yuan will not fully control people’s information and will provide them with required anonymity in their transactions, according to an official.
“We know the demand from the general public is to keep anonymity by using paper money and coins … we will give those people who demand it anonymity in their transactions,” said Mu Changchun, head of the digital currency research institute at the People’s Bank of China (PBoC), at a conference in Singapore on Tuesday, as reported by Reuters.
Mu added that the central bank would keep the “balance between the ‘controllable anonymity’ and anti-money laundering, CTF [Countering Financing of Terrorism], and also tax issues, online gambling and any electronic criminal activities,” continuing: “That is a balance we have to keep, and that is our goal. We are not seeking full control of the information of the general public.”
The official has regularly been giving updates on the digital currency, since his appointment in September. Earlier this week, Mu said that China’s digital yuan holders would not receive interest payments, and therefore, the digital currency will have no implications for inflation or monetary policy.
It is not clear when China will launch its digital currency, although it is “almost ready” after five years of research and development. Mu said at Tuesday’s conference that the goal of the digital currency is to create a new system in case of issues with China’s existing financial infrastructure, where two players – WeChat and Alipay – dominate electronic payments.
The official recently also said that the design of digital yuan would be similar to Facebook-led Libra stablecoin and that it could also be used across WeChat and Alipay payment platforms.