China could start launching its digital currency in the next two or three months, predicted the administrative partner of an investment company supported by Foxconn Technology Group.
China has developed a framework called Digital Currency Electronic Payment or DCEP, according to Jack Lee, managing partner of HCM Capital. This would allow its central bank to issue a digital currency to commercial banks and third-party payment networks via Alipay and WeChat Pay, he explained.
"So, they already have the whole system and network ready. I think you'll see it very soon, in the next maybe two or three months," Lee told CNBC's Tanvir Gill at the Singapore FinTech Festival on Monday.
He said the launch could start as a process, not to completely replace physical money.
HCM Capital has invested in a series of start-up blockchains, according to Reuters. It is supported by Taiwanese electronics manufacturer Foxconn, which has also invested in the $ 100 billion Vision fund of the Japanese company SoftBank, Reuters said.
Several experts have warned that virtual currencies could increase fraud risks, particularly money laundering and terrorist financing. But many governments have not found a way to regulate space.
Daniela Stoffel, Swiss Secretary of State for International Finance, said that the planned launch of the Chinese digital currency could push 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 implicit challenges in an electronic currency are now real, I hope this will give further momentum to decisions on a global basis," Stoffel told CNBC's Tanvir Gill Monday.
In addition to regulation, the potential increase in digital currencies would lead to questions about the role of national currencies and central banks, which should also be discussed internationally, Stoffel told the Singapore FinTech Festival.
China is not the only country that has examined digital currency issuance. In Switzerland, the Swiss National Bank declared last month that it is working with the country's stock exchange to examine the possible use of these currencies in trade.