Digital Currency Revolution Series: A Glimpse at Chinese Currency Manipulation, PBoC and Bank of China's Stands on Cryptocurrencies

President Donald Trump has recently Tweeted about a levy of 10% tariff on the consumer class goods being imported from China worth $300 Billion, which had largely remained unaffected by the trade war until now.

Consequently, to counter this development, the Chinese legislators and monetary authorities abstained Chinese firms from buying American agricultural goods that in-turn enabled their currency Yuan to depreciate to its lowest level since then. Hence, the U.S. Department of Treasury affirmed China as a ‘Currency Manipulator’.

Chinese yuan (CNY) has constantly been depreciating and CNY has dropped again this morning after the PBoC fixed the USDCNY very close to 7.00 (actual: 6.9996) handle this morning, reflecting the cautious mood among market investors.

In the meantime, the PBoC issued a statement in a response to the US' labeling China as "currency manipulator". The Chinese central bank said that the CNY depreciation is largely due to change of market conditions, and blamed that the US accusations are groundless. Most importantly, the state TV spent an unusually long time to report PBoC's statement, which suggests that China is taking a harder line in the trade tensions. As the risk of further escalation remains elevated, the market needs to be prepared for more turbulence.

The Bank of China describes Bitcoin prospects and its current position, why they are endorsing the leading cryptocurrency.

A property of Bitcoin has been the most eye-catchy which is ‘store-of-value’ that drives the underlying price rallies amid difficult monetary conditions.

While the People’s Bank of China (PBoC) made an announcement of approval from the state administrative authority to start working on a national digital currency in order to combat the uncertainty of Libra, as per the Chinese reports.

The official whitepaper of Libra, which was highly speculated cryptocurrency of Facebook, has been released on libra.org, with additional partners.

And according to bank representatives, Facebook’s Libra can be a potential threat for the domestic market as it intends to ease overseas payment operations. The social media giant, ‘Facebook’ has a worldwide network, they have access to nearly about 2.3 billion Facebook cryptocurrencies users, and the bank is mindful of the potential threat by the Libra’s scope for the local monetary policy, because Libra is likely to be pegged to the USD, which could even be more hazardous to the Chinese currency.

Well, with a view of a dealing and confronting such issue, the Chinese central bank would be equipped for designing and developing their private edition of national digital currency to assist domestic payments abiding by their central bank’s monetary policy.