Digital currency with central bank support needed

The development of a digital currency backed by a central bank is in need, said experts during a symposium on the subject.

Zhang Taowei, associate professor of the Department of Finance at Tsinghua University, said that the public needs to differentiate bitcoin from digital currency, and the latter distributed by a central bank plays an essential role to the country's financial system.

"Digital currency is the trend for the future," said Zhang, "but it needs a central bank to distribute it and a national credit system to support it."

Most recently, Fan Yifei, deputy governor of the People's Bank of China, the country's central bank, said that the bank will continue to steadily carry forward the research and development of digital currency, according to Xinhua.

"Blockchain, the technical foundation for digital currency, offers technological solutions to many of our financial problems," Zhang added. "For example, it is now used in the country's supply chain finance."

The technology is also used in other areas.

Lu Liang, founder and CEO of CyberMiles Foundation Ltd, which offers blockchain technology for e-commerce, said that blockchain and digital currency will dominate the mobile payment market, as it largely reduces transaction costs.

"A lower transaction cost will lead to a surging e-commerce market, as many countries now still remain inactive due to a lower rent but rather high online transaction fee," Lu explained.

Lu added that the research and development of blockchain technology will help China guarantee its leading role in e-commerce.