If you can't beat them, join them

MIT Technology Review reports that China’s central bank, the People's Bank of China, is testing a prototype digital currency with mock transactions between it and some of the country’s commercial banks. If implemented, China could be the first country in the world to run its own national cryptocurrency.

Speeches and research papers from officials at the People's Bank of China show that the bank’s strategy is to introduce the digital currency alongside China’s renminbi. But there is currently no timetable for this, and the bank seems to be proceeding cautiously. In January 01, 2016, cryptocoinsnews published a news article titled "China’s Central Bank Will Look To Issue Its Own Digital Currency as soon as possible". Since then, there has been intermittent news about Chinese cryptocurrency development.

According to Bloomberg, Bank of Canada, Deutsche Bundesbank and the Monetary Authority of Singapore are also examining digital currencies. Russia and the State of Palestine have indicated that they want their own national currencies. This is how Chinese national cryptocurrency could work:

• The PBOC creates cryptocurrency and transfers it to commercial banks when more liquidity is needed-
• Consumers would top up digital currency from modified automated teller machines or from bank tellers and store it in a crypto wallet on their mobile phone or other device
• For purchases, consumers wire from their person wallet to the merchant’s account
• The merchant deposits the cryptocurrency into their commercial bank account

This will bring banking services to anyone irrespective of their financial situation.