China has issued a digital version of its yuan currency. Photo: AFP / Fred Dufour

The People’s Bank of China (PBoC) is said to have moved one step closer to issuing its national digital currency.

A Global Times report on Tuesday, citing “industry insiders,” said the PBoC appears to have completed the development of the digital currency in collaboration with private companies.

The central bank is now reportedly drafting relevant laws to circulate the digital yuan, The Block reported.

An anonymous industry insider told the Global Times that Alipay’s recent patents revolve around the basic function of the digital currency, including circulation, payment and issuance.

Alipay, the financial arm of Chinese tech giant Alibaba, is said to have publicized five patents related to China’s digital currency earlier this year.

“Judging from the patents, the first step of technological development has been basically completed,” the insider was quoted as saying in the report.

Near completion? 

Earlier this year, the PBoC said the digital currency is “progressing smoothly” and that its “top-level” design had been completed.

“We will continue to steadily advance the development of legal digital currencies” in 2020, the central bank said at the time.

China’s digital yuan has been in the works since 2014. The launch date, however, still remains unknown.

Industry insiders told The Global Times that China should accelerate the launch of its digital currency amid the coronavirus pandemic and economic slowdown.

“If there is a chance China is considering lowering its interest rate into negative territory as a final option and directing such policy to commercial loans and lending, a circulated digital currency rather than M0 will be able to achieve that,” said Cao Yan, vice director of the Advanced Research Institute of Blockchain under the Yangtze Delta Region Institute of Tsinghua University.