In a recent post on the Digital Yuan being ready to launch, here on Publish0x, WriterBlock gave us the quick summary and details about the digital yuan and its corresponding wallet. So far, the Digital Yuan has been pilot tested in 4 Chinese cities: Shenzhen, Suzhou, Xiongan new area, Chengdu. This has been a trending topic in many of the cryptocurrency communities and news platforms. Even though the use of a digital currency on a nationwide level is exciting for many cryptoenthusiasts around the world, there are many who fear this would create a negative effect on the crypto economy. The people of China on the other hand, are concerned with a different topic, that the introduction of the Digital Yuan might cause and speed up the occurrence of heavy inflation.
To this, a spokesperson of the Digital Currency Research Institute of the People's Bank of China yesterday, on the 19th of April, directly responded (link in Chinese, use translate option) and assured people fearing the possibility that this will not happen. Namely, he noted, in order to eliminate the possibility of it contributing to rising inflation, the plan for the moment and the near future is for the digital currency to be introduced gradually. The currency will not be promoted or issued in large quantities, so the currency circulation rate will remain at a normal level. Furthermore, to ensure that the currency of the Central Bank is not oversold, commercial institutions will have to pay to the central bank a 100% reserve. So basically, the currency will be released into public circulation slowly, little by little with the banks and different financial operating agencies being the direct channels.
Whether it will be a success and a stable form of digital currency it remains to be seen. But the first stage of its testing is seemingly looking fairly bright.
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