US, WASHINGTON (ORDO NEWS) — The Central Bank of France has completed blockchain-based testing of digital euros. With the support of investment bank Societe Generale, securities were sold using the digital euro on a specially created blockchain system.
The bank noted that the results of the experiments will be an important element of the contribution of the central bank of France to a more global understanding of the virtual asset of the Eurosystem.
The department said in a statement that testing an experimental approach to creating a digital currency began this year. Together with partners, the Central Bank of France studied the potential contribution of new technologies to improving the functioning of financial markets and, in particular, interbank regulation.
In the next few weeks, the French central bank will continue to conduct additional experiments. It is about sending the euro in digital format between banks, the press release said.
It is interesting that initially France was extremely negative about cryptocurrency and any projects in this area, but then softened its position. The authorities, however, are convinced that digital money should be exclusively under the control of state regulators.
The head of the Bank of France, Francois Villeroy de Halo, admitted that cryptocurrencies can be useful in connection with a drop in the turnover of traditional funds, but control over virtual funds should remain the prerogative of state regulators, and not private, albeit large, companies. In December last year, the head of the French Central Bank announced that France should become the first country to issue digital currency.
So far, at the testing stage, the participation of digital euro in the retail payment system is not expected for citizens, a limited number of organizations participate in the project. Officials reported that cryptocurrency for consumers requires special control, and when working with new technology, a “serious and methodical approach” should be used.
Other countries, including China and the Marshall Islands, are also developing their own digital currencies.
China is already testing a crypto wallet. In April this year, the Agricultural Bank of China began testing an electronic wallet for a future payment system based on the stablecoin of the country’s central bank. Functionality involves making payments, exchange operations, managing a digital wallet, transaction history, payment using a QR code, etc.
So far, testing is also closed and available to companies operating in Shenzhen (Guangdong, South China), the new economic region of Xi’an (the center of the industrial region of Beijing – Tianjin – Hebei, Northern China), Chengdu, Suzhou (eastern Jiangsu).
The development of the digital renminbi began in 2014 and is now presumably at the final stage, although the exact launch date remains unknown.
The new system around crypto-yuan suggests that the People’s Bank of China will charge a new digital currency to commercial banks in exchange for the reserve in RMB. Further, citizens and companies can open wallets in these banks in order to be able to use the new electronic payment tool.
The “People’s Bank of China” carefully approached the development of its own cryptocurrency. Beijing thoroughly defended its developments in the field of digitalization and cryptography, having received patents for all those inventions that will be used in the circulation of the cryptocurrency renminbi, including a proprietary digital wallet, with which it will be possible to access all of the country’s public services, as well as the prospect of taking part in the popular vote.
The electronic payment system will become a hybrid of the People’s Bank of China’s current electronic payment network, banking infrastructure and other payment systems such as Alipay and WeChat Pay. According to Jack Lee, managing partner of HCM Capital, an investment firm supported by Foxconn Technology Group, the Chinese system will take advantage of cryptography and blockchain technology, including low costs and security.
While China is actively promoting its crypto-initiatives, a similar project has been pondered in the USA. If China succeeds in developing a national cryptocurrency, then the dollar will give priority to the yuan, and therefore the States are exploring the possibilities of digitizing the dollar.
Former chairman of the US Commodity Futures Trading Commission (CFTC) Christopher Giancarlo led a non-profit initiative to promote and study the digital dollar, which can be “sent as easy as a text message,” The Wall Street Journal previously reported.
Morgan Creek co-founder Anthony Pompliano said that the American crypto community is actively discussing information according to which the Federal Reserve can submit a plan to digitalize the dollar. “It will be similar to the attempts of the Chinese government to create a digital version of the renminbi. Regardless of whether this information is reliable, FED specialists absolutely must digitize the dollar,” wrote Anthony Pompliano on his Twitter.
Meanwhile, Christopher Giancarlo, the former chairman of the US Commodity Futures Trading Commission, plans to promote the idea of digitizing the US dollar using blockchain technology by launching The Digital Dollar Project for this purpose.
The digital dollar, according to the authors of the project, will be the third currency format, will be provided with Federal Reserve reserves and, having a digital form, should be as easy to carry out transactions as, for example, sending text messages. The initiative is launched by former Director of Innovation at CFTC Daniel Gorfin, brother of Christopher Giancarlo Charles and hedge fund Silver Lake Partners. They hope that their efforts will lead to the emergence of a “fully electronic currency on the blockchain.”
For a more effective implementation of the goal, a non-profit organization Digital Dollar Foundation was created within the framework of the project. Accenture was named as its main technology partner, which in December became a partner of the Central Bank of Sweden on a pilot project for the digital crown platform.
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