There are technical limitations to even the most technological ambitions of central banks.
That said Sky Guo, CEO of Cypherium, A blockachain platform for companies that has partnered with several Chinese cities and worked on planned central bank digital currencies. “CBDCs are definitely the hot topic with central banks these days” Said Guo.
CBDCs are all the rage this year, This is in large part due to the appreciation of stablecoins pegged to fiat currencies and the sudden interest in improving cashless payment systems in the context of the COVID-19 pandemic.
While the terms around CBDCs imply a language that has been borrowed from the world of blockchain-powered digital currencies, Even companies deeply involved in the investigation of CBDCs are reluctant to make a public commitment to include them on a blockchain. However, according to Guo, central banks are definitely interested.
“Most central banks are considering DLT (Distributed Ledger Technology) or Blockachain technology, or even using elements of the same technology.” Said Guo. “I think CBDCs will definitely use some of the blockchain designs while implementing centralized control.”
Too much, With the involvement of the biggest names in American intelligence, they are particularly concerned about China’s perception of leadership in developing a CDBC. Guo agreed to this “The Chinese yuan is trying to position itself as a global currency.” However, he was confident that China’s CBDC would ultimately be too big for distributed ledger technology:
“China’s CBDC is actually centralized because it has 1.4 billion people and a huge volume. No DLT today could handle this number of transactions.”
In the same way, Guo saw technical limitations in the dreaded monitoring of transactions by the dreaded People’s Bank of China:
“China says we will have controllable anonymity. So the government will not control all transactions, and technically they cannot. Currently, there are hundreds of thousands of transactions going on in China every second. If the government wants to monitor this, it will . ” something very expensive. “
However, Guo said that The Chinese central bank could delegate more of this responsibility to commercial banks. how you plan to distribute coins.
As for the youngest pilot of the digital yuan, Guo thought the results were successful.