China could start rolling out its digital currency in the next two to three months, predicted the managing partner of an investment firm backed by Foxconn Technology Group.
China has developed a structure called Digital Electronic Payment or DCEP, according to Jack Lee, managing partner of HCM Capital. That would allow its central bank to issue a digital currency to commercial banks and third-party payment networks by Alipay and WeChat Pay, he explained.
"So they already have the whole system and network ready. I think you'll see it soon in the next two to three months," Lee told CNBC Tanvir Gill at the Singapore FinTech Festival on Monday.
He said the launch could start as a test – not to completely replace physical money.
HCM Capital has invested in several blockchain startups, according to Reuters. It is backed by Taiwanese electronics maker Foxconn, which also invested in the $ 100 billion Vision Fund of the Japanese company SoftBank, Reuters reported.
Several experts warned that virtual currencies could increase the risks of fraud, particularly money laundering and terrorist financing. But many governments have not found a way to regulate space.
Daniela Stoffel, Switzerland's secretary of state for international finance, said the expected launch of China's digital currency could lead authorities around the world to decide how they want to use and regulate this technology.
"If governments now realize that this is really happening, and the question and the challenges implied in an electronic currency are real, I hope it will give more momentum to decisions at the global level," Stoffel told CNBC Tanvir. Gill on monday.
In addition to regulation, the potential rise in digital currencies would raise questions about the roles of national currencies and central banks – something that should also be discussed internationally, Stoffel said at the Singapore FinTech Festival.
China is not the only country that has analyzed the issuance of digital currencies. In Switzerland, the Swiss National Bank said last month it is working with the country's stock exchange to examine the possible use of these currencies in trade.