China accelerates the use of cryptocurrencies during the coronavirus outbreak

China accelerates the use of cryptocurrencies during the coronavirus outbreak


2021-04-19 13:53:02

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During the coronavirus outbreak, China began to actively put the ‘digital yuan’ into business practice, while tackling illegal banking activity and overcoming the dollar. common in circulation.

According to the Gazeta.ruThe coronavirus can be transmitted by banknotes and coins, epidemiologists and banking experts claim, and that this will accelerate the development of digital currencies around the world. Put your digital currency into business practice, while at the same time addressing illegal banking activity and overcoming the widespread dollar problem.

The state of emergency in China’s coronavirus infection is devastating for the banking and finance industry around the world. Cash infection – banknotes and coins – is completely real. People can become infected by contact with this amount and accidentally rub their hands on the mucous membranes of their eyes and nose.

This may just be a coincidence, but right now, China has announced additional measures to exclude cash from payments. In Chinese cities, payment for supermarket purchases via smartphones has been popularized for a long time.

Now, the Chinese authorities declare that they are ready to continue this trend. Beijing has released details on the use of cryptocurrencies in business transactions under the control of the Central Bank of China. The digital yuan will be called DCEP (Digital Currency Electronic Payment).

See also: China has begun experimenting with issuing DCEP digital currency

Unlike other digital currencies in a decentralized system, such as bitcoin, DCEP uses a centralized management system, meaning that the electronic form of the yuan will be centralized by the Central Bank. China controls, but some commercial banks will be allowed to issue. The Central Bank of China will become a hub for creating digital currencies and approving or blocking transactions.

Commercial banks will propose to issue DCEP on behalf of customers and perform transactions. Such a two-tier system is similar to the system used in ordinary currency issuance. But in this case, there is a significant difference: with digital currencies, the central bank and the government will be able to control all transactions.

DCEP is designed to replace cash in circulation that is expected to help reduce black credit risk for citizens.

To ensure the security of digital yuan, transaction information will be encrypted. To protect against hacking, it is intended to use authentication technology to ensure that the money is spent by a particular citizen.

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