Ethereum co-founder, Vitalik Buterin, recently made a post on Twitter about the CBDCs that are starting to pop up. He posed the question of whether transactions using CBDCs would be cryptographically provable. Buterin wanted to find out if a user who sends some amount of CBDC can generate a cryptographic proof that can be verified on the Ethereum chain.

Important tech question about these CBDCs that are starting to pop up (CC @mg0314a): will transactions be cryptographically provable? That is, if I send you N coins, can I generate a cryptographic proof that this happened that can be verified on the ethereum chain? … — vitalik.eth (@VitalikButerin) February 4, 2020

Since the PBoC announced China’s plans to launch a state-issued cryptocurrency, not many details about the “DCEP” have been made known to the public. According to reports, the PBoC has implemented a system to track the flow of customer funds. It is also going to collect and process information about transactions on the network using big data analytics.

CEO of Sino Capital and general manager of the China Investment Federation, Matthew Graham, has responded to Buterin’s queries. Graham claims he had been in touch with friends in leadership positions directly on China’s DCEP team.

2) “In the first step, CBDC will be not necessarily related to blockchain. It will be designed to a substitute for M0, with attributes similar to cash, and will be interest-free, while a cash-like CBDC may lead to the disappearance of paper-based cash.” — Matthew Graham (@mg0314a) February 8, 2020

Graham reported that, China’s CBDC will not necessarily be related to blockchain. However, it would be designed as a substitute for M0, with attributes similar to that of cash and would be interest-free. He added that, the cash-like CBDC may probably lead to the disappearance of paper-based cash.

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