"2022 Tsinghua Wudaokou global financial forum" was held from 15th to 17th. When attending the forum, Zhou Xiaochuan, President of China Financial Society and former governor of the Central Bank of China, responded to the five hot issues of the outside world on digital currency, and especially stressed that if technology companies want to participate in digital currency or payment system, they should move closer to high standards and should not be smart.
Question 1: how to distinguish and evaluate the feasibility and stability of CBDC (central bank digital currency) and M1 currency of commercial banks? There is a view that the central bank's currency is stable. It issues M0 currency. M1 currency in commercial bank accounts is commercial currency and does not have 100% stability. "This statement may actually have some problems, which is questionable, and it is easy to cause some confusion in trust." Zhou Xiaochuan said.
He said that although it is less than 100%, the currency of commercial banks has a high degree of stability, and the central bank's currency itself is not 100% stable. Its stability depends on purchasing power.
He further said that if the third-party institutions represented by large technology companies and fintech companies want to make digital currency or participate in the payment system, they should pay attention to integrity, not be clever, and move closer to high standards to varying degrees, such as high capital adequacy ratio, deposit reserve requirements, deposit insurance mechanism, strong supervision and corporate governance, because once they break away from the above standards, There will be problems in the stability of the company, which will affect the stability of the whole system.
Second question: how to understand the M0 positioning of digital RMB emphasized by the Central Bank of China? Zhou Xiaochuan said that first of all, the emphasis on the research and development of digital currency is to replace M0, indicating that he wants to focus on retail applications, especially to provide greater convenience to the people with the help of the Internet and mobile Internet terminals.
Secondly, the central bank manages M0 and M1 in different departments. "Research and development costs and pilot costs are managed. Therefore, M0's positioning also avoids everyone's war." Zhouxiaochuan said.
Thirdly, at present, in the central bank and financial system, M1 operates normally, and there is little room for further improvement. Positioning at M0 can avoid the impact on the normally operating M1 system.
Question 3: should the Central Bank of China speed up and issue more digital currencies? It was mentioned, especially the cross-border digital currency, which is also related to the current geopolitical problems. I hope that digital currency can play a certain role in this regard.
"You can decide how much money to print, but whether it can go out and circulate depends on the application." Zhou Xiaochuan also pointed out that if other payment instruments are used well, M0 will decline. For example, the wallet of third-party payment actually does not have real currency and cash, but all account funds. We feel that there is a substitution relationship without taking so much cash.
Zhou Xiaochuan mentioned that there are many international discussions that China's rapid development of digital currency is a "great weapon" in the future, but currency issuance is the debtor of the balance sheet. The central bank should ensure the purchasing power of the issued currency through institutional guarantee, commitment and backup support. From this perspective, it is not so easy to apply digital currency in other aspects, especially geopolitical issues.
Fourth question: at present, there are many schemes and products competing for the best of digital currency. It may take a process to require its universality. How should we grasp this relationship? Zhou Xiaochuan said that it is impossible to emphasize a high degree of consistency at the beginning, and it is impossible to decide who will do the standard in advance. Advanced standards are not formulated. Only when multiple schemes are carried out in parallel in practice, so that they can compete and select the best. After a certain stage, some institutions can enhance universality, so as to promote interoperability compulsorily or semi compulsorily.
Question 5: does digital currency have to be legislated first and have international standards? "This wish is good, but it is still in the process of R & D and innovation. It is impossible to make the legislation so clear." Zhou Xiaochuan pointed out that the people's Bank of China Law stipulates that the people's Bank of China is responsible for issuing RMB and managing the circulation of RMB. At the same time, it should maintain the normal operation of the payment and clearing system. The research and development of digital currency belongs to RMB, so it does not say that legislation should be made first. Without legislation, there can be no digital RMB.
He also said that the issue of currency is a matter of sovereignty and does not involve international standards. Although it is hoped that international organizations can play a certain role, especially in guiding and establishing order in cross-border payment standards, there is no legal requirement that international standards must be first.
