No bank account needed for China’s digital currency

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Binance Research, part of the major crypto exchange, has revealed that no bank account will be necessary to use China’s Central Bank Digital Currency (CBDC).

According to its report published on 28th August, China’s CBDC will be transferable without a bank due to its loosely coupled design. This refers to a system of components that do not all depend on each other.

As a result, users will be able to transfer CBDC without a bank account. The design of China’s forthcoming digital currency aims to provide some user anonymity, as well as promoting a CBDC turnover rate equivalent to that of cash. Furthermore, it is hoped that it will boost the circulation and internationalization of the renminbi.

Binance Research also reported that the People’s Bank of China (PBoC) is considering using smart contracts as part of its infrastructure, but it is hesitant about implementing anything that would extend beyond “basic monetary requirements,” although it didn’t define what it means by that. The report claims that PBoC is worried that by using smart contracts these might add value to the CBDC that would identify it as a security. This would in effect reduce the utility of CBDC and also hinder the international reach of the renminbi.

As previously reported by a number of sources, the PBoC denied that it planned to launch the new digital currency in November this year. However, as Cointelegraph reports, an anonymous source told Forbes that told Forbes that the tech behind its CBDC was complete and that it could potentially arrive as early as 11th November.

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