BEIJING, China—The People’s Bank of China (PBOC) is getting closer to becoming one of the first major central banks to issue digital money that can be used for any type of purchase.
At the same time as it builds up its own capabilities, the PBOC is increasing scrutiny of bitcoin and other private digital tenders, reports Equities.com, which adds that the PBOC “doesn’t want a bitcoin bubble to blow up. And since currencies have historically been issued by the state, not private players, it doesn’t want to cede the cryptocurrency space to companies it has no control over.”
For the PBOC, using blockchain, the technology that underpins the digital currency bitcoin, will allow it to trace transactions and collect “real-time, complete and authentic” data to compile precise monetary indicators such as money supply growth, Duan Xinxing, vice president of Beijing-based OKCoin Co., one of the country’s biggest bitcoin exchanges, told Equities.com.
“The transparency of economic activities in every corner in the country will significantly improve,” Duan told the website. “The central bank will have unprecedented knowledge of how the economy runs.”
So instead of relying on monthly surveys of businesses, or collations of spending from the statistics authority, the PBOC and therefore the government would have real-time readings on the pulse of consumers. Policies could then be fine tuned on a day-to-day, even hour-to-hour basis, giving an unprecedented level of precision to monetary management, Equities.com said.