China is planning to launch a yuan-backed cryptocurrency, RBC Capital Markets reported. Analysts and industry leaders are underlining the China’s geopolitical implications of 1st introducing a crypto coin, especially if the United States regulators dismiss Libra.
RBC stated in a note to clients on Tuesday:
“If US regulators ultimately dismiss Libra and decide not to draft regulations to encourage crypto innovation in the United States, China’s CBDC may be strategically positioned to become the de facto global digital currency in emerging economies.”
The analysts of RBC also noted that messaging apps can give a vast opportunity to onboard customers to digital wallets and, as a result, it will lead to massive crypto coin adoption, underlining that China has the possibility to spread the potential token through messaging & payment apps like Alipay, WeChat & UnionPay.
China has been researching digital currencies as early as 2014 with the intention to reduce payment costs and improve payment convenience. In 2018, governor of China’s central bank Zhou Xiaochuan said that crypto is technically inevitable.
In September, Mu Changchun (deputy director of the People’s Bank of China’s payments department ) also stated that the crypto coin of China is intended to protect China’s monetary sovereignty and legal currency status.