Blockchain integration into PBOC digital currency is uncertain
PBOC will become the first central bank to release digital currency and materialize practical implementations. The claim is supported by the successful test run of the blockchain-based digital commercial paper exchange, upon which the digital currency backed by PBOC is also tested.
“In the future, there might be a distributed ledger to record the digital currency issued by PBOC, service of which may include authentication-free identity and download-free digital wallet.”
Dr. Zhou Yonglin, Senior Manger of ICBC, says :
“Commercial banks may offer digital wallet as well. Customer’s bank deposits and digital currency are packed in the digital wallet.”
As pointed out by Li Wei, Director of Technology Department of PBOC, Blockchain technology is not mature in terms of system stability, application safety and business mode. The PBOC are testing the blockchain technology in scenario with non-realtime requirement, lightweight information, small transaction throughput and low confidentiality.
According to Caixin report, the DVP settlement based on digital currency and Digital Paper registration and transfer system based on blockchain technology have been completed on 15th December 2016. A digital paper platform and a digital currency demo system have been deployed and connected to the network of selected banks.The effort behind these projects indicates that the authority are trying to tap the Fintech and taking the lead in the arena.
“Director Zhou Xiaochuan is hoping to test digital currency, blockchain and other mature technology on the digital paper platform.”A source close to PBOC told Caixin.
By introducing digital currency into settlement, the information flow and the funds flow of digital paper transaction could be transferred simultaneously.
“Digital currency system involves distributed structure, cryptology, safety chips, mobile payment, trusted computation etc. Blockchain technology is only one of the options to realize this. The blockchain integration on digital currency relies on solving the defects like network security, transaction processing performance and transaction consistency.”
Li Wei says:
“It should be noted that the commercial paper exchange is a prelude to large scale blockchain adoption. The prototype system built around the commercial paper use case by PBOC in 2016 is to verify the feasibility of scale deployment in financial sectors. “
On 8th December, 2016, the Shanghai Commercial Paper Exchange (SCPE) Opening Ceremony. Source: gov.cn
SCPE is the first national exchange on commercial papers. But it’s independent from the digital paper exchange. SCPE is the exchange for electronic commercial papers and ECDS documents trading while the digital paper exchange is in shadow mode with limited participants for testing purpose.