Wallets for holding the digital version of China's yuan currency are already being counterfeited. Photo: iStock/Getty Images

Wallets for holding China’s central bank digital currency are already being counterfeited, a Beijing official has warned.

Quartz reports that in a speech on the digital yuan’s progress at a financial forum in Shanghai on October 25, Mu Changchun, head of the Chinese central bank’s digital currency research institute, said, “We have spotted counterfeit digital yuan wallets in the market. Just like in the era of paper currencies, the central bank also has the task of fighting forgery [of the digital yuan].”

Mu’s comment highlighted the difference between cryptocurrencies and the digital yuan. Transactions involving cryptocurrencies such as bitcoin do not require verification by centralized intermediaries such as banks because all transactions are indelibly stored on a blockchain, providing a decentralized way to combat fraud. China’s new digital currency, however, is backed by the country’s central bank and all transactions must be verified by it.

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