Huang Qifan, Vice Chairman of China Center for International Economic Exchanges (CCIEE), has said that the Chinese central bank will be the first in the world to release a sovereign digital currency.
Qifan, who reportedly has strong ties with the Chinese government, made the revelation this week at Inaugural Bund Financial Summit of 2019 in Shanghai, a gathering where financial leaders globally discuss issues pertaining to fintech, wealth management, and financial inclusion.
As part of his speech, Qifan admitted that the current system for making global payments no longer fits the emerging digital age and thus needs a reshape.
At the forefront of global payments is the US SWIFT (Society for Worldwide Interbank Financial Telecommunication) system and CHIPS (Clearing House Interbank Payments System) which Qifan argued that the United States is using to control the global economy primarily by enforcing sanctions.
To this end, the Chinese official expressed dissatisfaction at the large scale preference given to SWIFT, especially despite its vulnerabilities such as being slow to update, delayed transactions, and expensive fees.
He also did not speak favorably of either Bitcoin or Libra, arguing that the decentralized cryptocurrency lacks the qualities of sovereign money (being issued by a government) and that Libra will not succeed amid regulatory woes.
Qifan then disclosed that he believes China has been working on the development of a DCEP (digital currency electronic payment) system, telling the audience,
The People’s Bank of China has been studying DCEP (digital currency electronic payment) for five or six years, and I think the technology has matured. PBOC is probably the first central bank to introduce digital currency in the world.