Source: Mobile Payment Network
Author: Yu Yunfeng
On July 16, the People's Bank of China released the "White Paper on the R&D Progress of China's Digital RMB" (hereinafter referred to as the "White Paper") to clarify the basic position of the People's Bank of China on digital RMB research and development, and to explain the research and development background and target vision of the digital RMB system. , design framework and related policy considerations.
The "White Paper" clearly defines the digital renminbi from the central bank level for the first time, that is, the digital renminbi is a digital form of legal tender issued by the People's Bank of China, which is operated by a designated operating agency, based on a generalized account system, and supports the loose coupling function of bank accounts. Equivalent to RMB, it has the characteristics of value and legal compensation.
In terms of the design features of digital RMB, it takes into account the advantages of both physical RMB and electronic payment tools. It has the characteristics of physical RMB payment that is settlement, anonymity, etc., and electronic payment tools have low cost, strong portability, high efficiency, and are not easy to forge. Features. And mainly consider 7 major characteristics:
1. It has both account and value characteristics.
2. No interest is calculated.
3. Low cost.
4. Settlement upon payment.
5. Anonymity (controllable anonymity).
6. Security.
7. Programmability.
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The value transfer form of central bank digital currency
The digital renminbi has both account and value features. The digital renminbi is compatible with three methods: account-based, quasi-account-based and value-based. It adopts a variable denomination design and realizes value transfer in the form of encrypted currency strings.
In fact, we have discussed a long time ago whether the account form or the token form of the digital renminbi is used.
Central bank digital currency (CBDC) can be divided into different types according to different manifestations. For example, from the perspective of applicable objects, CBDC can be divided into retail type and wholesale type; from the perspective of operating structure, it can be divided into indirect type and direct type. type and mixed type; from the value paradigm, it can be divided into account form and token form.
Previously, the mobile payment network believed that the digital renminbi, as a legal currency, is a supplement to M0, and it is first oriented to C-end users, which is a retail CBDC. Since the digital renminbi is a liability of the central bank and adopts a two-tier operating system, it is a hybrid CBDC from a structural point of view. From the perspective of the value paradigm, the digital renminbi adopts a generalized account system. Although there is no clear point of view to prove whether the digital renminbi is in the form of an account or a token, from the actual experience point of view, it is more inclined to the underlying account form.
Earlier, we also specifically discussed the digital renminbi form in the dual offline form.
Yao Qian, director of the Science and Technology Supervision Bureau of the China Securities Regulatory Commission, said at the International Financial Forum (IFF) held at the end of May this year, "From public reports, the digital RMB has adopted the account route, while some countries have chosen to use blockchain technology as a Representative encrypted currency technology route. I personally understand that the two technical routes based on accounts and tokens are not an either-or relationship. In essence, tokens are also a kind of account, but a new type of account-encrypted account. Compared with traditional Accounts, users have stronger self-control over encrypted accounts.”
At present, it is certain that the digital renminbi does adopt an account-based approach. But what are the three methods of account-based, quasi-account-based and value-based here?
From the perspective of the mobile payment network, the account-based account actually refers to the digital RMB wallet registered by the user, and the digital RMB "account" formed after the real name; It can still satisfy the basic payment; while value-based may refer to the encrypted currency string stored locally in the "hardware wallet", which is placed in smart cards, mobile phones and other carriers through the recharge operation, and has actual value attributes. Transfer of value to and from devices.
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Programmability of Central Bank Digital Currency
The "White Paper" introduces that the digital renminbi realizes programmability by loading smart contracts that do not affect currency functions, so that the digital renminbi can conduct automatic payment transactions according to the conditions and rules agreed by the transaction parties on the premise of ensuring safety and compliance, and promote business. Model innovation.
In March of this year, the Digital Currency Research Institute of the Central Bank released the "Open Project for Legal Digital Currency Innovation Research (2021)", which mentioned that smart contracts have the advantages of transparency, credibility, automatic execution, and mandatory performance, and are combined with legal digital currencies. Afterwards, it can be applied to business scenarios such as conditional payment and scheduled payment, which is conducive to playing the role of currency. Focusing on the research and development needs of legal digital currency, focusing on key technologies related to smart contract systems such as contract languages, virtual machines, and compilers, with innovative academic ideas, clear and advanced research objectives, and scientific and feasible research plans.
At the 13th Lujiazui Forum in June this year, Mu Changchun, director of the Digital Currency Research Institute of the Central Bank, shared in detail the wallet system of the digital renminbi. Several sub-wallets can be opened under the mother wallet. Individuals can realize the functions of limit payment, conditional payment and personal privacy protection in payment scenarios through sub-wallets. Management; enterprises and institutions can use sub-wallets to realize fund collection and distribution, accounting processing, financial management and other functions.
He said that the central bank and designated operating agencies jointly develop basic payment function components, and use smart contracts to realize conditional payment functions triggered by time conditions, scene conditions, and role conditions. risk of running away.
In fact, according to the mobile payment network, the "red envelope" in the digital renminbi pilot activity is actually the embodiment of a "smart contract". Rules, such as no transfer, no redemption, overtime withdrawal, etc.
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The technical route selection of the central bank's digital currency
The choice of technical route for digital renminbi has always been another focus of attention in the industry.
According to the "White Paper", the technical route selection of the digital renminbi is a process of long-term evolution, continuous iteration, and dynamic upgrading. It is guided by market demand and regularly evaluated and continuously optimized and improved. Designated operating agencies can choose their own technical route according to their actual needs and technical advantages, and fully maintain insight and forward-looking on future technologies.
The digital renminbi system adopts a distributed and platform-based design to enhance system resilience and scalability, and support the rapid growth of digital renminbi payment transactions; comprehensively apply technologies such as trusted computing, software and hardware integration dedicated encryption, etc. to ensure system reliability and Robustness: Carry out multi-level security system construction, design multi-point multi-active data center solutions, ensure city-level disaster recovery capabilities and business continuity, and provide 7x24 hours of continuous service.
The digital renminbi system integrates the characteristics of centralized and distributed architectures, forming a mixed technical architecture with the coexistence of stable and sensitive dual modes, and the integration and development of centralized and distributed.
In fact, regarding the issue of the technical route, Mu Changchun said a long time ago that the digital renminbi will adopt the method of horse racing during the research and issuance period. The so-called "horse racing mode" means that on the premise of voluntary participation, the participating parties choose their own scenarios and technical routes. If the trial results are good, direct adoption is not ruled out.
Therefore, in terms of technology selection, the attitude of the regulatory level has always been "technology neutral", and whoever does it will win.
At the briefing, regarding the application of blockchain technology in the digital renminbi system, Mu Changchun also said that blockchain has the advantages of data immutability and traceability, but has shortcomings in performance and scalability, and is more suitable for Scenarios such as asset confirmation, transaction transfer, and ledger verification with low concurrency and sensitivity. According to the technical characteristics and scope of application of the blockchain, the People's Bank of China has explored innovative applications of the blockchain in the fields of trade finance, confirmation transactions, and transaction reconciliation, such as the trade finance blockchain platform and digital bill trading platform.
Therefore, in the transaction layer of the digital renminbi payment system, in order to support high concurrency and low latency, and realize the public's direct holding of the central bank's claims, a centralized structure is adopted, and all cross-institutional transactions are transferred through the central bank; at the same time, a design based on The digital renminbi expression of encrypted strings retains the characteristics of security, anti-double spending, and unforgeability. It can also load smart contracts with currency-related functions, promote business model innovation, and become a catalyst for digital economic activities.
That is to say, at the transaction layer, the digital renminbi does not use blockchain technology, because the characteristics of the blockchain are not suitable for high-concurrency and high-expandability scenarios; characteristics can be used.
He said that at the issuance layer of the digital RMB payment system, a unified distributed ledger is built based on alliance chain technology. The central bank, as a trusted institution, uploads transaction data to the chain through application programming interfaces to ensure that the data is true and accurate. Reconciliation, collective maintenance of ledgers, and multi-point backup. In order to fully reflect the advantages of digital renminbi "payment is settlement", the digital renminbi system combines the blockchain consensus mechanism and programmable smart contract features to achieve automatic account reconciliation and automatic error handling. At the same time, taking advantage of the irreversible nature of the hash algorithm, the blockchain ledger uses the hash digest to replace transaction sensitive information, realizing data isolation between different operating agencies, which not only protects the security of personal data privacy, but also avoids financial data caused by distributed ledgers. Security Risk.
