China to issue its own cryptocurrency

China plans to issue its own cryptocurrency as early as Nov. 11, the country’s busiest shopping day for online sales, U.S. financial magazine Forbes said, citing two sources familiar with the matter.

The People’s Bank of China (PBOC) has been exploring the possibility of launching its own digital currency since 2014 to cut the costs of circulating traditional paper money and boost policymakers’ control of money supply.

Some analysts say China appears to have accelerated the push to digital money after U.S. social media giant Facebook announced plans in June to launch digital coin Libra – the most high-profile proposed digital currency so far – within a year, a move that has shocked global policymakers and raised regulatory concerns.

The PBOC plans to distribute its cryptocurrency through at least seven institutions in the initial stage, including Chinese tech giants Alibaba and Tencent, China’s largest payments card issuer China UnionPay, and four Chinese state-owned banks, the report said, citing a source involved in the development of the cryptocurrency and a former employee of one of the institutions who is now an independent researcher.

Paul Schulte, who worked as global head of financial strategy for China Construction Bank until 2012, was reported saying the banks include China’s biggest lender the Industrial and Commercial Bank of China , China Construction Bank , Bank of China and the Agricultural Bank of China .

The PBOC did not immediately reply to Reuters’ faxed request for comment. Alibaba declined to comment, while the other six institutions did not immediately provide any comment.

Earlier this month, Mu Changchun, deputy director of PBOC’s payments department, told a forum the PBOC is “almost ready” to launch China’s own sovereign digital currency.

The report added that the PBOC hopes its cryptocurrency will eventually be made available to spenders in the United States and elsewhere through relationships with correspondent banks in the West. (Reporting by Cheng Leng, Yawen Chen and Josh Horwitz; Additional reporting by Sijia Jiang; Editing by Richard Borsuk and Jacqueline Wong)

Source: Reuters