Bitcoin’s increasing price value is one of the leading reasons why people are focusing more on other cryptocurrency alternatives, says the representative of People’s Bank of China.
There is no country more advance than China when it comes to developing a digital currency such as CBDC, formally known as Central Bank Digital Currency. After carrying out several tests, PBoC interpreted that the rising interest of people in the initiatives for CBDC is due to Bitcoin itself.
Is Bitcoin Surging CBDC Demand?
According to the survey conducted by the Bank for International Settlements, almost 4 out of every five central banks are launching their own CBDC; these 80 percent of central banks are backing the apparent trend of this digital currency. A research bureau director of PBoC, Wang Xin, has pointed the Chinese population’s curiosity towards digital yuan and told that everyone is giving it more attention now. This might be because more and more banks are taking part in making domestic digital currencies every year.
Meanwhile, Xin believes that Bitcoin could also be playing a major role in this regard as the massive price jump from ten thousand dollars from October 2020 to sixty thousand dollars has surged a demand of CBDC in the market. This garnered the attention of institutional investors towards the crypto industry has raised questions, but China’s digital yuan is predicted to be highly centralized and controlled by local authorities, unlike that with the case of primary cryptocurrency.
Several real-world trials by China are being conducted for several months, which is the primary reason for nation advancement towards this matter. PBoC in the past has distributed millions of dollars on digital yuan to the public as an experiment, so the people could spend it on daily life products, such as merchandise, food, etc.
However, people did not understand this ground-breaking development’s potential; hence, the feedback to this was controversial. Nevertheless, this hasn’t stopped China from running more tests. Further, Xin declared that the coming trials will even push it more and will gather more extended experience.
As the number of central banks of countries, including the UK, Switzerland, and Sweden, are planning to issue their own CBDC, China remains at the top in this race.