Architect of China's CBDC Project Faces Probe for Alleged "Violations of Discipline and Law"

Ruholamin Haqshanas

Last updated:

April 26, 2024 08:25 EDT | 2 min read

Yao Qian, the influential figure behind China’s central bank digital currency (CBDC) project, is currently under investigation for suspected “violations of discipline and law.”

Qian played a pivotal role in leading the research effort at the People’s Bank of China (PBOC) to develop and issue a digital yuan, according to a report by state-owned news outlet Shanghai Securities News.

However, he left the central bank in 2018 and has since been working at the China Securities Regulatory Commission.

“Yao Qian, Director of the Science and Technology Supervision Department and Director of the Information Center of the China Securities Regulatory Commission, is suspected of serious violations of discipline and law and is currently under investigation by the Central Committee.”

Further details regarding the specific allegations against Qian were not disclosed.

Qian Had Notable Influence on CBDC Project

Qian’s involvement in the CBDC project was influential not just within China but also globally

The development of China’s digital yuan project served as a catalyst for other major jurisdictions worldwide to explore the concept of central bank-issued digital currencies

The investigation into Qian’s alleged wrongdoing comes at a time when China is making significant strides in the implementation and testing of its digital yuan, also known as the Digital Currency Electronic Payment (DCEP) .

The report mentioned that disciplinary review and supervision of the investigation are being conducted by the Discipline Inspection and Supervision Team of the State Commission for Discipline Inspection at the China Securities Regulatory Commission, as well as the Supervisory Committee of Shanwei City, Guangdong Province.

China’s most prominent pro-blockchain official, Yao Qian, is under investigation by the Chinese government for suspected violations of law. The specific reasons are unknown. He was the creator of China’s CBDC and served as the director of the central bank’s digital currency…

— Wu Blockchain (@WuBlockchain) April 26, 2024

According to the Atlantic Council CBDC tracker, 130 countries, representing 98% of global GDP, are currently exploring a CBDC, while 19 of the G20 countries are in the advanced stage of their CBDC development.

In total, 11 countries have fully launched a CBDC, which include China, The Bahamas, Nigeria, Anguilla, Jamaica, and seven Eastern Caribbean countries.

It is worth noting that the United States is among the few countries that have no confirmed plans to launch a digital currency.

However, the country has been still moving forward on a wholesale (bank-to-bank) CBDC.

China’s Central Bank Addresses Crypto Regulation

In its latest financial stability report, the People’s Bank of China (PBoC) addressed issues related to cryptocurrency regulation and decentralized finance

The Chinese central bank emphasized the need for joint efforts by different countries to regulate the industry effectively.

In 2021, the PBoC announced measures to combat the adoption of cryptocurrencies in mainland China, advocating for stronger inter-departmental coordination to crack down on crypto activities

Despite the ban on virtually all crypto transactions and cryptocurrency mining, mainland China has remained a major crypto-mining hub.

As reported, China is set to revise its outdated anti-money laundering (AML) law in a bid to tackle the increasing risks associated with virtual assets.

The draft amendment, discussed at a State Council meeting chaired by Chinese Premier Li Qiang, will soon undergo review by the national legislature.

While the full text of the proposed amendment has not been disclosed, legal scholars have indicated that its primary objective is to combat money laundering involving virtual assets.

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