According to scmp.com, the governor who led the People’s Bank of China from 2002-18, stated that China worked hard to establish its digital currency and electronic payment (DCEP) system, but its focus differed from G7 principals. In a report released in October 2020, the G7 said stablecoins need to be appropriately supervised to prevent threats to global financial stability and ensure they were not used to fund illicit activities or tax avoidance.
China thinks that digital currencies have to respect exchange regimes and currency sovereignty. However, a major factor in Beijing’s digital currency plan was to prevent the US dollar to be used in parallel or instead of the local currency. China’s central bank gets closer to the launch of its sovereign digital currency after it published a draft law at the end of October that would give legal status to the DCEP system, and including the digital yuan as part of the country’s sovereign fiat currency.
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