China is preparing to launch a national cryptocurrency as part of a plan to expand further into financial technology.
The system could be the most advanced cryptocurrency released to date, opening up the world’s largest domestic market to the technology.
According to a senior Chinese bank officer, the cryptocurrency will help safeguard the nation’s foreign exchange sovereignty as the technology continues to grow and more use cases are realised.
“Why is the central bank still doing such a digital currency today when electronic payment methods are so developed?” Mu said, according to a transcript of a lecture he gave this week that was published online and reported by Reuters.
“It is to protect our monetary sovereignty and legal currency status. We need to plan ahead for a rainy day.”
Mu added that the cryptocurrency’s tokens would be equally as secure as central bank-issued paper notes and could be used even without an internet connection.
The system will share several similarities with Facebook’s recently-announced Libra cryptocurrency, and will work across existing payment platforms such as WeChat and Alipay.
Facebook is set to launch both Libra and its Calibra digital wallet next year, but has been tight-lipped on what form both offerings will actually take. It has said it won’t launch Libra until all of the regulatory issues are addressed.