China’s upcoming virtual currency – CBDC referred to as the digital yuan should be regulated in line with cash-related laws, consistent with a senior exec at the country’s central bank.
According to a recent official report published today on 14th Sept., Fan Yifei, a deputy governor of the PBoC [People’s Bank of China], revealed the main regulatory principles for the operation of the digital yuan. the digital representation of the official currency of the People’s Republic of China.
In line with Fan, the digital renminbi is legally compensatory to the traditional fiat currency. Within the article, the deputy governor revealed that the digital RMB is “mainly positioned” as M0, which suggests that the digital currency is a component of the availability of paper notes & coins. As such, the digital RMB “needs to suits laws and regulations associated with cash management”, Fan added.
The deputy governor went on to mention that consistent with the renminbi’s indemnity provisions, the digital renminbi might be employed to pay “all public as well as personal debts within the territory of our country.” Fan added that the upcoming virtual currency should be accepted everywhere within the country, and “no unit or individual may refuse to simply accept it if the conditions are met.”
Explaining further, Fan added that the digital renminbi must be accepted as per laws and regulations on cash management, AML & combatting terrorist financing.
The digital yuan is reportedly being piloted within several regions in China along with Beijing, Tianjin, Hebei, & the Hong Kong Greater Bay region. Earlier in August, Reuters reported that the PBoC is planning to use its virtual currency at the upcoming Winter Olympic Games 2022.