What China’s CBDC launch means for bitcoin
The rising popularity of bitcoin is to China’s advantage to develop its own CBDC. Close attention to the world’s flagship cryptocurrency is beneficial to the People's Bank of China. The regulator actively promotes its digital national currency.
Several central banks in different countries have noticed that a sharp rise in the value of the world's first virtual coin accelerates the launch of the digital yuan. Being a leader in this field is the top priority for Beijing especially given that monetary authorities worldwide are engaged in the creation of their own CBDC. Among them are the United States, Sweden, France, and the European Union. China intends to win that race. Despite the fact that it is all about a digital version of traditional money and not about a new cryptocurrency, the substantial rise in bitcoin price stirs up interest in CBDCs. Experts assume that the digital yuan will be able to compete with fiat money when it becomes a full-fledged form of payment. According to the People's Bank of China, the project is currently at its final stage and the digital yuan will be launched in the near future.
It is not clear what the launch of China’s CBDC has in store for bitcoin. Numerous experts suggest that the country will either impose restrictions on BTC or ban it. China’s authorities were extremely cautious about cryptocurrencies at first and even imposed severe restrictions on them. For example, they banned ICO, an analogue of IPO in the cryptocurrency market. Moreover, exchange trading in cryptocurrencies is under strict control in China.