China should strengthen cooperation with other countries to regulate the cryptocurrency industry, and not accelerate the development of its own digital currency, experts say. It is reported by the South China Morning Post.
So, the former deputy chairman of the People’s Bank of China, Zhu Min, noted that the central bank, which is developing a digital yuan in many ways as Facebook’s Libra response, should first of all take part in the development of international regulation of such assets.
Ba Shusong, chief China economist for the Hong Kong stock exchange, also believes that monitoring digital currencies requires a system that is controlled from different angles, as they have the potential to change the global financial system.
You would need to first improve the regulatory framework for [financial] technology. There is a need for global cooperation for an alternative regulatory framework.
Chief China economist for the Hong Kong stock exchange
Many fear that the popularity of Libra could strengthen the dominant role of the US dollar. At the same time, Deutsche Bank analysts believe that the digital yuan will undermine the primacy of the dollar in the global financial market.
Hiromi Yamaoka, the ex-head of the Bank of Japan supervisor of payment and settlement systems, also emphasized that the upcoming launch of Libra has caused competition among central banks seeking to make their currencies and services more attractive.
Something like Libra would make transactions costs much cheaper. Major central banks need to appeal that they, too, are making efforts to make settlement more efficient with better use of digital technology.
Former head of the Bank of Japan’s (BOJ) division overseeing payment and settlement systems