The launch of digital currency is not a matter of one day or one night

Recently, at the People's Bank of China Digital Currency Seminar, relevant officials of the People's Bank of China stated that they would strive to launch digital currency as soon as possible, which attracted market attention.

The person in charge said that the People's Bank of China has established a special research team since 2014, which has conducted in-depth research on the issuance and business operation framework of digital currency, key technologies, circulation environment, etc., and further strengthened its forces in early 2015 to conduct in-depth research on the issuance and business operation framework of digital currency, key technologies of digital currency, etc. The research has achieved phased results.

Some people may ask, electronic payment has become more and more mature, and bank card online payment and transfer are very convenient, so why do we need to launch digital currency? What is the relationship between digital currency and electronic payment?

"Digital currency and electronic payment are two different concepts." Cao Lei, director of the China E-Commerce Research Center, said in an interview with a reporter from China Business News that one is a form of electronic currency for physical goods or service transactions in the virtual market, while electronic payment is an Internet payment method. In the virtual market, digital currency can be circulated through electronic payment, and electronic payment is a digital currency transaction carrier.

Although the central bank did not give a precise definition of digital currency at the meeting, the meeting believed that issuing digital currency could reduce the high cost of issuing and circulating traditional paper currency, improve the convenience and transparency of economic transactions, reduce illegal and criminal activities such as money laundering and tax evasion, enhance the central bank's control over money supply and circulation, better support economic and social development, and help realize inclusive finance. "The future prospects of mobile payment are bright, and the central bank is actively studying relevant research results and practical experience at home and abroad."

When it comes to foreign practical experience, the most familiar one is the previously popular Bitcoin. As a type of digital currency, Bitcoin has been circulated around the world since 2009. It is reported that more than 60% of its transactions are in China .

However, China did not support Bitcoin transactions before. In December 2013 , the central bank and five other ministries and commissions issued a "Notice on Preventing Bitcoin Risks", which pointed out that Bitcoin is a specific virtual commodity that does not have the same legal status as currency and cannot and should not be circulated and used as currency in the market.

Although it is not supported, the notice also makes it clear that as a commodity trading behavior on the Internet, ordinary people have the freedom to participate in Bitcoin transactions at their own risk.

However, most analysts believe that the digital currency proposed by the central bank this time is very different from Bitcoin.

"The most typical representative of digital currency is Bitcoin. Previously, the country did not encourage the development of digital currencies such as Bitcoin, but there is an essential difference between Bitcoin and the digital currency that the central bank wants to launch. Bitcoin is not issued by a specific monetary institution, and relevant financial supervision has not followed up, so there is a greater financial risk. However, the digital currency that the central bank is considering launching this time belongs to a government agency and is protected by the central bank." said Cao Lei, director of the China E-Commerce Research Center.

In Cao Lei's opinion, the central bank intends to launch digital currency mainly due to the following factors: first, there is great pressure for capital outflow, and the depreciation of the RMB is a high probability event; second, with the industrial "Internet + " boom, digital currency has obvious advantages over traditional currency, one is convenience, and the other is low cost; third, it meets consumer demand. China's online shopping expenditure reached US$ 562.66 billion in 2015. Online shopping is the fastest growing online activity, and digital currency has more circulation value in the Internet market.

Even so, Cao Lei also reminded that the actual implementation of digital currency will not happen overnight, and it is necessary to consider consumer acceptance and whether it is suitable for the development of the domestic market economy.