Privacy has been a discussion that has not gone unnoticed when it comes to the forthcoming launch of the digital yuan. The head of the Peopleâ€™s Bank of China-run Digital Currency Research Institute had firmly pointed out that anonymity cannot be guaranteed at all.
Feature Seeks to Avoid Tax Evasion and Finance Terrorism
During an interview with the Securities Times, Ma Changchun told the 2021 China Development Forum that a fully anonymous central bank digital currency (CBDC) is impossible.
The reason, said the official, is that the government needs to make it compliant with the anti-money laundering (AML), know-your-customer (KYC), and counter-terrorist financing (CTF) measures.
Per the official, such transactions should also be scrutinized to avoid tax evasion schemes through the upcoming Chinese CBDC, developed by the PBoC.
However, Ma clarified that there would be a â€œcontrollable anonymizationâ€ technology implemented in the digital yuan.
Although he didnâ€™t explain in-depth the â€œcontrollable anonymizationâ€ concept, Ma pointed out that such anonymity is the one that itâ€™s commonly used for privacy consumer protection purposes.
The Role of the Telecom Providers
Still, he explained how the digital yuan wallet could work out with KYC measures implemented:
The head of the Digital Currency Research Institute also clarified which would be the role of the domestic telecommunication providers in the digital yuanâ€™s development process:
What do you think about the â€œcontrollable anonymizationâ€ mentioned by the Chinese official? Let us know in the comments section below.
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.