China's digital currency will be like Facebook's Libra, says central bank official

A senior official from China's central bank has offered some further details on the country's upcoming digital currency, saying that its design would be similar to Facebook's proposed cryptocurrency Libra.

Mu Changchun, deputy director of the People's Bank of China's (PBoC's) payments department, made the comments at a lecture this week, Reuters reported Friday. Mu added that the digital currency could also be used across major payment platforms such as WeChat and Alipay.

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China has been developing such a currency to protect its "monetary sovereignty and legal currency status," according to Mu. The official further said that the issue with digital currencies issued by corporates such as WeChat and Alipay is that these companies could, in theory, go bankrupt, which could cause users losses.

China's central bank-issued digital currency, on the other hand, will be safe as paper notes and could be used even without an internet connection, Mu said.

Just last month, the official said that the digital currency is "ready" after five years of development. It will not rely entirely on a pure blockchain architecture, as this would not allow the currency to achieve the throughput required for retail usage, Mu said at the time.

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Yogita Khatri is a senior reporter at The Block, covering all things crypto. As one of the earliest team memb