China intends to start issuing its domestic one kryptowaluty. Digital Currency Electronic Payment (DCEP), because that is the name of the Chinese digital currency, has not yet been launched, and is already causing many controversies. Many crypto observers are of the opinion that DCEP is to serve the Chinese authorities in mass financial control of citizens.
DCEP is the national currency of China
Although the exact release date is not yet known, it is already known that China is planning to introduce its cryptocurrency, and the first reports on this topic appeared already this summer.
According to an official announcement issued by China International Center for Economic Exchange (CCIEE), People's Bank of China (PBoC) intends to be the first bank in the world to launch the national digital currency. Works on this undertaking have been carried out for several years.
What do we know about DCEP?
The Chinese DCEP cryptocurrency is to be built based on a two-tier system that will connect both Chinese Central Bank with commercial banks as well as commercial banks with retail clients and institutions.
The Chinese government is quite reluctant to disclose the technical details of the venture, but all indications are that DCEP will not be a decentralized currency based on blockchainie.
And this is where the concerns about the Chinese government's plans stem from - such a step means that the national cryptocurrency will be under total government controlas a tool to control citizens.
Meanwhile, the Chinese authorities maintain that blockchain is to help the Chinese financial system solve current problems.
China's dislike of other cryptocurrencies
CCIE has clearly expressed its position that any decentralized currency that is not subject to government monetary policy is exposed to the risk of instability, and are therefore not credible solutions.
Concerns about China's introduction of a national cryptocurrency
It is difficult at the moment to clearly indicate what the consequences of the introduction of the Chinese cryptocurrency DCEP will be, but its planned issue raises many concerns.
It will certainly be a breakthrough solution, because China will be the first to issue virtual state money.
This solution also provides opportunities for an effective fight against crime.
On the other hand, given the regime in China, DCEP will hit public privacy by providing information on how citizens spend their money.
This is in opposition to the idea of a free, democratic digital currency that guided the creation of cryptocurrencies such as Bitcoin.