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China economy
EconomyChina Economy

Is China set to beat Facebook’s Libra by launching its digital currency this autumn?

  • ‘Forbes’ magazine reported that China’s central bank will launch its own sovereign digital currency to coincide with the Singles' Day online shopping festival
  • The People’s Bank of China is seeking to address financial risks and counter the current dominance of the US dollar

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The Singles' Day is a holiday celebrated in China on November 11 and has become the largest online shopping day in the world. Photo: Simon Song
Amanda LeeandSidney Leng

China’s desire to launch the world’s first government-backed digital currency could see the possible rival to Facebook’s Libra be launched in time for November’s Singles’ Day online shopping festival despite a Chinese media report playing down the timing as “inaccurate speculation”.

Several central bank officials have publicly spoken out over the past several weeks about the need for China to launch its own digital currency since Facebook unveiled its plans for Libra, and the People’s Bank of China (PBOC) appear to be making rapid progress ahead of an expected launch.

Forbes magazine reported this week, citing a source who previously worked for the Chinese government, that China's central bank could launch the digital currency as soon as November 11 as its bids to address financial risks and to counter the current dominance of the US dollar.

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The PBOC did not respond to a faxed request for comment on the Forbes story, although Sina.com said that the report was “inaccurate speculation” citing an unnamed source close to the central bank.

China’s central bank is expected to distribute its digital currency through the big four state-owned banks – the Industrial and Commercial Bank of China, China Construction Bank, the Agricultural Bank of China, and the Bank of China – and mobile payments systems Alipay and WeChat Pay, as well as UnionPay, the state-supported credit card provider, according to the Forbes report. Alibaba is the owner of the South China Morning Post.

Mu Changchun, deputy chief of the Payment and Settlement Division of the PBOC, said at the start of August that a digital currency prototype existed and that the central banks’ Digital Money Research Group had already fully adopted blockchain architecture to ensure its use in retail transactions.
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