The President of the Central Bank of the Republic of China, Yang Chin-long, emphasized that developing a central bank digital currency (CBDC) is not a race.
He stressed that the central bank prioritizes steady progress over speed.
Yang mentioned that being the first to introduce a CBDC doesn’t guarantee success, as evidenced by countries that have already issued or tested CBDCs without achieving their desired outcomes, according to a July 7 news report by UDN.
In a report released on June 7, ahead of his presentation to the Finance Committee of the Legislative Yuan on June 10, Yang detailed the central bank’s plans for a digital New Taiwan dollar.
He explained that the bank is experimenting in three scenarios to enhance domestic payment efficiency and innovation.
While there is no set timetable for issuing a CBDC, efforts to improve the payment system’s efficiency and foster innovative applications are ongoing.
A significant development is the CBDC prototype platform designed for retail payments.
Yang highlighted that this platform can already support the cash flow operation of digital coupons, with transaction processing speeds reaching 20,000 transactions per second.
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Additionally, a proof-of-concept for a wholesale CBDC is underway.
This initiative combines CBDC with bank deposit tokens to create a future digital currency system, aiming to function as a liquidation asset for asset tokenization.
The central bank also plans to use tokenization technology to digitally transform wholesale central bank currency and commercial bank currency, supporting various asset tokens.
To further these objectives, Taiwan’s central bank is conducting proofs-of-concept and collaborating with participating banks to build a common platform for tokenization.
This platform will be tested in three scenarios: inter-bank transfer of bank deposit tokens, simultaneous delivery of asset tokens, and special-purpose digital money.
Yang reiterated that Taiwan’s cautious approach to issuing a CBDC is designed to meet public digital payment needs and align with government digital policy goals, ensuring substantial benefits.
In March, the Financial Supervisory Commission announced that it would propose a new draft of digital asset regulations for Taiwan in September 2024.
This aims to create more effective regulations for digital asset markets and ensure investor safety.
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