The central bank's digital currency is about to be released. How can you participate? Everything you want to know is here!

This article is reprinted with permission from CoinDesk Chinese, author: Lin Yi; the content is intended to convey more market information and does not constitute any investment advice.

The central bank's digital currency DCEP (Digital Currency Electronic Payment) is a combination of digital currency and electronic payment. In short, the central bank's digital currency DCEP is a digital payment tool with value characteristics and M0 attributes issued by the People's Bank of China. Explanation and definition:

1. Issued by the People's Bank of China (PBOC) means: this is a digital currency issued by the PBOC with its credit guarantee, which has unlimited legal compensation, belongs to the category of legal tender, and has the status of legal tender. No Chinese institution or individual can refuse to receive and pay DCEP. 2. Having value characteristics means: the function of the central bank's digital currency is the same as that of paper currency, but the central bank's digital currency is presented in a digital form and needs to be downloaded to a mobile digital wallet for use. However, unlike traditional mobile payments, the central bank's digital currency supports "dual offline payment", that is, in the absence of a network, as long as the mobile phone can be turned on normally, payment can be made. 3. The M0 attribute can be understood as: a replacement for cash (banknotes + coins), promoting the "paperless" of cash. At the same time, it will also have the same value scale, means of circulation, means of payment and value storage as cash. In addition, the anonymity of transactions is guaranteed by loosely coupled account design, but accounts with suspicious transactions can still be found through big data analysis. In addition, because the central bank's digital currency is a substitute for cash, holding the central bank's digital currency does not generate interest. (CoinDesk Chinese version note: At present, China's money supply can be divided into different levels according to the strength of money liquidity, namely M0, M1, M2, etc. M0 generally refers to cash in circulation, M1 generally includes M0 + demand deposits of various units, and M2 includes M1 + residents' savings deposits + unit time deposits + unit other deposits + securities company customer deposits.) 4. Purpose of digital payment tools: It is expected that the central bank's digital currency can be used in scenarios where RMB legal tender is accepted, and it is not mandatory to bind a bank card. Five issues you need to pay attention to:

How to obtain and use the central bank digital currency?

The central bank's digital currency will adopt a "two-tier structure", with the upper layer including the central bank to commercial banks and the lower layer including commercial banks to individuals and commercial institutions. First, the central bank will exchange the central bank's digital currency to commercial banks according to the 100% reserve system, and then the commercial banks will exchange the digital currency to the public. Users can apply for it through the counter or non-counter methods. Digital wallets will be classified according to the degree of real-name. The higher the degree of real-name, the higher the wallet limit.

Why is the central bank issuing digital currency? Are other countries also working on central bank digital currency?