From the perspective of the Chinese government Cryptocurrencies are not considered legal tender. Instead, they are divided into a kind of “virtual product”. However, some industry players believe that the Blockchain Service Network (BSN) infrastructure can stimulate the development of virtual currencies like CBDC.
During an interview with Cointelegraph, Eden Dhaliwal, global CEO of Conflux Network, a Layer 1 blockchain protocol and the only government-backed public blockchain project in China, said the Chinese government is highly motivated to launch a CBDC to “dominate the landscape” . of digital commerce and preparing the economy for the future. “
The BSN is an important blockchain interoperability infrastructure network. In July they announced the decision to divide BSN’s governance into two ecosystems: BSN China and BSN International.
Dhaliwal explained why BSN split this way and what impact this had on the Chinese blockchain ecosystem:
“It is very likely that BSN will split up to make the network compliant, more secure and more economically stable without losing the functions of public blockchain networks. (…) This two-tier ecosystem ensures the flow of capital and wealth through chains and countries without compromising the reliability of the network. “
In order to integrate public chains into BSN, Dhaliwal claims to achieve scalability and adoption for retail users and ensure massive ecosystem growth BSN “must integrate a variety of public chains in order to create interoperability, innovation and internationalization of digital assets and instruments”:
“Since one of BSN’s main mandates is to advance the blockchain ecosystem in China, implementing private chain solutions allows a focus on limited government and corporate use cases.”
He told Cointelegraph that By including public networks in the mix, “opportunities are created for innovative financial instruments and digital companies that can be seamlessly integrated into the CBDC”.
In August, the Chinese Ministry of Commerce announced that it would extend testing of the country’s central bank’s digital currency to Beijing, Tianjin and Hebei provinces. According to an Aug. 14 report in the Wall Street Journal, there is still no set date for the start of the China CBDC’s expanded pilot program.