Yang Chin-long, Governor of the Central Bank of the Republic of China, stated that developing a central bank digital currency (CBDC) is not a race, and the central bank is focusing on steady progress rather than speed.

According to UDN’s news dated July 7, Yang said that being the first country to introduce CBDC is not a guarantee of success, and that countries that have already issued or tested CBDC have not achieved the desired results.

Yang outlined the central bank’s plans for a digital New Taiwan dollar in a report published June 7, before presenting to the Finance Committee on Wednesday, June 10.

Yang said the central bank is experimenting in three scenarios to improve domestic payment efficiency and innovation. While there is no set timetable for issuing a CBDC, efforts to improve the payment system’s processing efficiency and innovative applications are ongoing.

A key development is the CBDC prototype platform designed for retail payments. According to Yang, this platform can already support the cash flow operation of digital coupons, and transaction processing speeds can reach 20,000 transactions per second.

Additionally, a proof of concept for wholesale CBDC is in progress. This initiative combines CBDC with bank deposit tokens to create a future digital currency system. It aims to function as a liquidation asset for asset tokenization.

The central bank plans to apply tokenization technology to digitally transform wholesale central bank money and commercial bank money and support various asset tokens. To achieve its goals, the Central Bank of Taiwan is conducting proof-of-concept studies and collaborating with participating banks to create a common platform for tokenization.

The report states that this platform will be tested in three scenarios: intra-bank transfer of bank deposit tokens, simultaneous delivery of asset tokens and special purpose digital money.

Yang reiterated that Taiwan’s cautious approach to issuing CBDC is to meet the public’s digital payment needs and align with the government’s digital policy goals, aiming to provide significant benefits with this approach.

In March, the Financial Supervisory Commission announced that it plans to propose a new draft of digital asset regulations for Taiwan in September 2024. This aims to create more effective regulations for digital asset markets and ensure the safety of investors.

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