Creator of the digital yuan envisions CBDC operating on networks like Ethereum

CBDCs could operate on networks such as Ethereum and Diem, complementing two-tier models where central banks distribute tokens through intermediaries. The view was expressed by former head of the National Digital Currency Department of the People’s Bank of China (PBoC), Yao Can, according to CryptoNews, citing local media.

He worked on the digital yuan from 2014 to 2019. He currently serves as head of the Department of Science and Technology Supervision at the China Securities Regulatory Commission.

“The work of CBDC in public networks will allow the PBoC to distribute tokens directly to clients through Blockchain-as-a-Service [blockchain as a service] systems without the need for a broker”, the official said.

Yao envisions a parallel approach combining a two-tier system favored by most central banks with brokerless solutions. He stressed that the latter would be of interest to people without bank accounts, and overall customers would benefit from greater choice.

“Two-tier CBDC models and brokerless models are not alternatives. Like taxis and buses, they can operate harmoniously,” he explained.

The official touched on CBDC privacy. He noted that the push for token issuance is driven by a wave of digitization, and the PBoC does not intend to assist the government in “seeing all transactions.”

Earlier, Mu Changchun, director of the CBDC Institute at the PBoC, ruled out the emergence of fully anonymous national digital currencies.

In January, the builders of China’s national blockchain platform (BSN) announced the integration of the digital yuan with 30 public blockchains in 2021.

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