DCEP: China's own digital currency https://cloud.tencent.com/developer/news/435883
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Earlier we discussed the Libra revolutionary and limitations, then I want to talk to you one important thing, and that is the People's Bank under study, we Chinese own digital currency.
I do this when the course was in August 2019, from the People's Bank of China to launch our own digital currency is not very far away. Our digital currency project called DCEP (Digital Currency Electronic Payment), which is digital money and electronic payment instruments.
Its design logic, many places very similar Libra. But I have to clarify, not that we imitate Libra, in fact, do the Chinese central bank's own digital currency as early as 2014, the then governor Zhou Xiaochuan had proposed this idea.
Bank of digital currency is an alternative bill
Bank of digital currency is what is it?
It's exactly the same functions and attributes with the bill, but its form is digitized. We define it translates to "digital payment tool valuable features."
What have "feature value" mean? Simply put, "do not need an account to be able to realize the value of the transfer." Think you can understand the bill. When you pay with paper money, you do not need an account, DCEP well.
You can imagine this scenario: As long as you have a phone on me DCEP digital wallet, and that even the networks do not need, as long as the phone has power, two mobile phones nudged, you can put a personal digital wallet digital currency, to another person.
In other words, when you pay, you do not need to bind any bank account. As we now use micro-believe or Alipay, all want to bind a bank card, but DCEP not.
Of course, unless you want to go digital wallet to charge money, or you want to take money out of the digital wallet to finance, in addition, mutual transfers between the user and the user is not required to bind the account.
This means that, DCEP can be like the same bill in circulation. That is why, you can make it simple to understand digital alternative to paper money.
In fact, encryption assets such as Bitcoin, it is a fundamental advantage is to get rid of the traditional control of the bank account system, because it's just an encrypted string. From that point on, DCEP also has the same advantages.
So what is it not the same?
Not the same as the central bank of digital money belongs to legal tender, like cash, the central bank also has a digital currency liquidating unlimited method, that you can not refuse to accept DCEP.
We see now the private payment mechanism or platform, will set up a variety of payment barrier, with local micro-channel can not be used to pay treasure, with local Alipay can not micro-letters, but the central bank of digital money, as long as you can use electronic payment place , we must accept the central bank's digital currency.
That DCEP, with our usual Alipay, micro-channel payment, specifically, what difference does it make?
First, from the Law, efficacy and safety DCEP is the best.
Your use of paper money the central bank currency, DCEP is the central bank issued, but you do electronic payments using Alipay or micro-channel when using a Alipay electronic purse, wallet micro-letters, their money is going to come from it? They are not settled by the central bank currency, but the settlement currency deposits with commercial banks. Of course, the provision for centralized depository later, the situation has changed.
In other words, micro-channel and Alipay legal status, security, did not reach the same level and banknotes.
In theory, commercial banks are likely to go bankrupt, so these years the People's Bank to establish a deposit insurance system; but assuming micro letter bankrupt, micro-channel purse, it has no deposit insurance, you can only participate in its bankruptcy liquidation, such as before you have 100 dollars, and now you can also dime, you can only accept, it is not subject to central bank lender of last resort to protect. Of course, this possibility is very small, but you can not be completely ruled out.
Secondly, we also take into account some extreme cases, such as large earthquakes, communications were cut off, of course, will not succeed electronic payment.
At that time, only two possibilities, one bill, one is the central bank of digital currency. It does not require the network will be able to pay, we called "double offline payment" refers to both the balance of payments offline, can be paid. As long as your phone has power, even if the entire network can also be implemented to pay off.
We can also say that some of the less extreme cases, you can perceive, for example, you go to the underground supermarket to buy things, there is no cell phone signal, micro-letters, Alipay are impossible.
Or, on the plane, there is no signal, if you take a low-cost airline, will need to spend money to eat, under this scenario, that you can only pay by credit card, then you can also pay by Bank of digital currency . But this, like digital currency such as Libra is not.
Of course, some people may ask, DCEP position will pay treasure, micro-letter affect you? Our answer is: do not.
Because the current Alipay, micro-channel is the use of RMB payment, in fact, is payment currency deposits with commercial banks. After the central bank to launch digital currency, the yuan is only replaced by digital, which is the currency deposit with the central bank, although payment instruments has changed, the function also increased, but did not change channels and scenes.
But why in the electronic means of payment is so advanced today, the central bank should do such a digital currency it?
First, in order to protect their sovereignty and coin currency status law, we need to plan ahead.
Besides, now that the bill, coin issuance, printing, return, storage costs are very high in all aspects, but also put some of the cost of doing anti-counterfeiting technology, hierarchical distribution system will be more, and inconvenient to carry, and now no one willing to take the cash.
In addition to the criminals do not want to let people know, or you may be some consumer does not want to let other people know, other than specially cash, most people now need to use the cash is less and less.
Of course, as long as you do the crime, you want some did not want to let others know of consumption, which we want to protect privacy.
That is to say, in fact, there is a public demand for anonymous payments, but now the payment instruments, such as Internet payment, bank card payment system are the bank accounts with the traditional tightly bound, it can not meet the needs of anonymity, also it is impossible to completely replace cash payments, that is, bills to pay.
Therefore, the central bank of digital money can solve these problems, it can maintain the property and the main features of cash value, but also to meet the requirements of portable and anonymous.
How digital currency the central bank anti-money laundering
However, payment convenience of the people is one aspect, but had to keep a balance, it is not convenient crime.
Implementation DCEP, we will face the same problem of money laundering. Carried out with money laundering bill, although a relatively high degree of anonymity, but there are certain costs, such as to wash the money more, then, should a truck pull, but the cost of digital currency is relatively low.
What if after the launch DCEP, anti-money laundering how we do?
The way we conduct anti-money laundering, anti-tax evasion, terrorist financing these work, you can use the previously mentioned large data. That is, while the ordinary transaction is anonymous, but if we use big data to identify some of the behavioral characteristics of the time, or you can lock this person's true identity.
For example in terms, involves a lot of money-laundering transactions, there are behavioral characteristics, such as a large number of gambling took place after 0:00, and all gambling transactions are not odd, are multiples of ten. In general, beginning with a small, growing, cliff suddenly gone, which is not traded, it means that gambled, which is in line with the general characteristics of gambling.
Telecommunications fraud, too, if a large number of scattered money into one account which, suddenly and quickly spread, which disappeared in many accounts, which meet the obvious feature of electricity fraud.
After that we analyze the characteristics of these transactions out, re-use big data and data mining technology, identity comparison, that person will be able to find out later.
So, for reasons of anti-money laundering, we also have a digital wallet grading and quota arrangements. For example, you use a mobile phone number registered a wallet, then you can of course use the wallet, but it must be the lowest level, can only meet the daily needs of micro-payment; but if you look at ID card to be able to upload, or upload a bank card, you can get a higher level of digital wallet, if you can go to the counter to sign your face, it's probably not the limit.
That the next lesson, we will look at, DCEP in the end is how to operate it?