China’s Digital Currency is Not About Total Surveillance – Official
As China is preparing to launch its domestic digital currency, a person in charge of its development says that its creation is not about controlling people’s information, but maintaining a balance.
The goal of this move by China is not gaining full control of information belonging to the general public, but to create a balance between privacy concerns and the need to gather information by the authorities, Reuters reported, citing Mu Changchun, head of the digital currency research institute of the People’s Bank of China (PBoC).
There are still not many details known about so-called Digital Currency Electronic Payment (DCEP) which China is working on, including when exactly the country plans to roll it out, but some have expressed concern over how much of a doorway into the public’s personal information this currency will provide to the government, especially in light of China’s surveillance efforts.
However, as Reuters writes, the new currency’s design “seemingly provides Beijing with unprecedented oversight over money flows, giving Chinese authorities a degree of control over their economy that most central banks do not have.” In that respect, Mu Changchun is quoted as saying that the public demands anonymity by using coins and paper money, and “we will give those people who demand it anonymity in their transactions.”
Nonetheless, he said that there’s balance that has to be maintained between “the ‘controllable anonymity’ and anti-money laundering, CTF (counter terrorist financing), and also tax issues, online gambling and any electronic criminal activities,” he says, adding: “We are not seeking full control of the information of the general public.”
Previously, Mu named two goals of DCEP:
- create a new system in case China’s existing financial infrastructure faces problems
- boost financial inclusion in rural areas.
He also said, as reported a few days ago, that DCEP is designed to substitute existing coins and paper money – its holders wouldn’t receive interest payments and there would be no implications for inflation or monetary policy.
Meanwhile, we’ve been reporting about the possibility of China creating its own digital money for a while now, ever since the rumours started, following the development of the situation. According to the opinion of George McDonaugh, managing director and co-founder of KR1 plc, the London listed cryptocurrency and blockchain investment company, “DCEP will be the exact opposite of every feature of Bitcoin. It won’t be public, transparent, permissionless, global or censorship-resistant. It will be identical to the system they have now, except with added stronger surveillance controls.”