- Ren Zhengfei, the founder and CEO of the world’s No. 1 telecom supplier and No. 2 phone manufacturer, Huawei said, China can issue its own version of Libra
- China’s central bank is already working on developing its own digital currency
On asked about the prospect of Facebook launching its own cryptocurrency dubbed Libra, Ren Zhengfei, the founder and CEO of Huawei, the world’s No. 1 telecom supplier and No. 2 phone manufacturer said, China can just issue its own version of Libra.
“China can also issue such a currency by itself. Why wait for others to issue it? The power of a country is always stronger than an Internetcompany,”
Zhengfei told Italian economics journalist, Fabio Savelli.
Recently, Zhou Xiaochuan, governor of the People’s Bank of China (PBoC) said with Libra offering, Facebook has shown that there is a potential for a “strong” global cryptocurrency
“Libra has introduced a concept that will impact the traditional cross-border business and payment system,” he said.
While Libra may help developing countries improve their payment systems, it would also pose a threat to the existing cross-border payments system and further weaken the national currencies, Zhou said.
China Developing Its Own Digital Currency
China’s central bank is reportedly working on its own digital currency in response to Libra.
Earlier this month, Wang Xin, director of the PBoC research bureau argued that if Libra becomes widely used for payments, particular for cross-order payments would it able to function it like money and
“accordingly have a large influence on monetary policy, financial stability and the international monetary system?”
The reason for the bank to create its own digital currency Wang said is because of the unclear role of the US dollar once Libra, closely associated with the US dollar is issued as in “essence” there is only one “boss.”
Reported, PBoC has received approval from the State Council, the chief Chinese administrative authority to start working with institutions and other market participants on a central bank digital currency.
As per the public information available on the State Intellectual Property Office website, the central bank’s Digital Currency Research Lab filed over 53 patents between June 2017 and March 2018.
These patents cover applications related to a system that allows interbank settlement using digital currency, a digital wallet, and a system for digital currency-based fundraising.