China could launch its own digital currency within the next 6 to 12 months, in what could become a challenge to the U.S. dollar’s global dominance, according to fund manager Edith Yeung, a partner at blockchain-focused venture capital fund, Proof of Capital.
The Chinese government has been researching and studying the possibility of launching its own digital currency in recent years and has identified entities for a potential roll-out, said Yeung.
“It’s really been something (that’s) been in the works for the last few years,”she told CNBC on Wednesday.
Asked how soon a virtual yuan could become a reality, she said it could be “quite soon.”
“So I think definitely within the next six to 12 months,”said Yeung.
The Chinese government is being really smart about driving the adoption of RMB,” Yeung said, referring to the renminbi, another name for the Chinese yuan. “Can you imagine, especially for the One Belt One Road initiative, they (start) to lend all in virtual RMB? Many of these countries will want to work with China to start adopting virtual RMB.”
The One Belt One Road initiative is Chinese President Xi Jinping’s signature infrastructure project to connect more than 60 countries in Asia, Europe, Africa and the Middle East.
“I really think that the United States needs to hurry up to have a strong thinking and policy, at least a direction for virtual USD.”
In June, social media giant Facebook unveiled its plan for its digital currency project Libra. But those plans have been under fire amid privacy concerns and its impact on the global financial system.
For her part, Yeung said the Libra project has inspired other countries to think about the potential for their own virtual money.
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