Taiwan Focus on Steady Progress
Yang Chin-long, who is the President of the Central Bank of the Republic of China, laid emphasis on the fact that one of the most important reasons for the absence of such currency is nothing else than competition. Yang stressed that the Central Bank does not aim to get a head start and launch the first CBDC but rather takes its time in making gradual progress in CBDC development. He mentioned that the first-movers in the CBDC sector have not always reached the expected results, said by UDN in the materials on July 7.
Plans for Taiwan’s Digital Dollar
In a report released on June 7, Yang provided a detailed account of the central bank’s strategy for a digital New Taiwan dollar. The submitted report on June 10 to the Finance Committee of the Legislative Yuan offered three such scenarios as examples which are domestic payment efficiency and innovation improvement in the country by use of cryptos.
In the opinion of Yang, it is clear that there is no specific timetable for the issue of a CBDC, therefore, the work of improving the payment system’s processing efficiency and applications is in progress. The most remarkable achievement is the CBDC prototype platform being developed for retail payments that can remain functional for 20,000 transactions per second and thus support the cash flow operation of digital coupons.
Wholesale CBDC and Tokenization
Next, also in process is the proof of a wholesale CBDC. The purpose here is to connect CBDC with bank deposit tokens so as to make a digital currency system which can be a liquidation asset for asset tokenization.
The central bank wants to utilize tokenization technology to do bank conversion and bank currency in the digital space to allow for multiple asset tokens. Trust will be built among inventors and banks, and they will gain success in developing a shared tokenization platform. In such platforms, tests are run for example in inter-bank transfer of bank deposit tokens and the simultaneous delivery of asset tokens and special-purpose digital money.
Aligning with Digital Policy Goals
The announcement was made by Yang that the delegation of Taiwan has planned to issue a conservative CBDC that is related to public digital payments. This is the way to the intersection of government and private sector goals. They are sure that the cover of CBDC will give rise to considerable services.
In an additional but interdependent matter, the Financial Supervisory Commission produced a statement in March about its intention to propose digital asset regulations for Taiwan in September 2024. This is to impart the regulatory framework for the digital asset market in a stronger sense and the way a security market compliance is to be done(o)
