What impact will be brought by the digital financial era of CCB app online digital currency wallet?

 What impact will be brought by the digital financial era of CCB app online digital currency wallet?

The reporter saw that in the create digital currency wallet page, there are payment, collection, scan and transfer at the top, and there are collection and payment and my entrance at the bottom.

Sun Guofeng, director of the Monetary Policy Department of the central bank, said on August 25 that at present, the digital RMB is still in the stage of internal closed pilot test and has not been officially launched. In the next step, the central bank will continue to steadily promote the research and development of digital RMB. There is no timetable for the official launch of digital RMB.

1. The history of Chinese currency development

Before the founding of the peoples Republic of China, especially in ancient China, the evolution of money was relatively slow. From cattle, sheep, shells and gold with practical value at the beginning, and then to paper money with credit value, the form of money became more and more convenient to carry and transport.

According to media reports, the central bank digital currency pilot in Suzhou (Xiangcheng District) will be issued in the form of transportation subsidies.

2. What are the characteristics of digital currency?

The most essential difference is that the digital currency of the central bank is the electronic version of RMB. According to the definition of supply, it belongs to M0 currency, which is directly equivalent to cash, and the main body behind it is the government. WeChat and Alipay belong to M1, but the electronic payment means of money. They rely on the credit of commercial companies, not the real number of RMB.

In addition, digital currency really gets rid of the dependence of online payment on the network. As long as the equipment has electricity, both remote areas and underground garages with poor signal can pay smoothly.

From a macro perspective, since the popularization of third-party payment in China, cash payment has been in the doldrums. After 2015, cash withdrawal from bank cards began to show negative growth. The implementation of digital currency also helps to cope with the decline of physical cash flow, and helps the central bank to cope with the challenges of decreasing cash payments and the increasingly widespread application of digital money or digital payment services provided by the private sector.

In addition, digital currency helps to reduce M0 cash operating costs. In the era when cash payment was the mainstream means of payment, the peoples Bank of China and banking financial institutions operated cash according to the strictest confidential materials every year, which resulted in huge operating cost of cash currency. The more issued, the heavier the burden.

According to the calculation of Huaxi Securities, the operating cost of traditional RMB cash is about 276.7 billion yuan / year.

By issuing digital currency, the central bank turns it into a string of encrypted digital symbols based on controllable algorithms (cryptography and some blockchain algorithms) and through the Internet, which brings about huge cost substitution effect and greatly improves the efficiency of cash flow.

Therefore, technically speaking, the implementation of legal digital currency helps to improve efficiency and reduce payment costs, which is also a way to strengthen government centralized management.

3. 10% of the worlds central banks consider issuing digital currency in the short term

From a global perspective, once an economy starts to use digital currency, it will have a global spillover effect. Therefore, all countries economies will pay more and more attention to this new trend.

At present, as early as 2014, the Central Bank of China has set up a special research group on the issue of fiat money, and its research and development is in the forefront of the world. However, other countries still hold different opinions on whether to issue legal digital currency, but more and more central banks have begun to join in the study of CBDC.

According to a survey released by the Bank of International Settlements in 2020, 10% of central banks consider issuing digital currencies in the short term, and their economies cover 20% of the worlds population (about 1.6 billion people).

Note: the above statistics are incomplete

4. Four questions about digital currency

CCB responds to online digital currency source: Qiao JunJing, editor in charge of Beijing News_ NBJ11279

CCB responds to digital currency launch