Facebook's plans to launch Libra force China to accelerate work on its own cryptocurrency, said the representative of the People's Bank of China.

People's Bank of China is activating researches on developing its own digital currency. The decision was due to reports on future launch of Libra. The Chinese central bank fears that Libra may become a problem for the regulator, being actively used in cross-border payments and violating monetary policy and threatening the financial stability and sovereignty of China.

“If [Libra] is widely used for payments, cross-border payments in particular, would it be able to function like money and accordingly have a large influence on monetary policy, financial stability and the international monetary system?” Wang Xin, director of the People’s Bank of China research bureau, said at a scientific conference hosted by Peking University’s Institute of Digital Finance.

According to Wang, the People’s Bank of China pays “high attention” to researches in the field of digital assets and te associated financial blockchain infrastructure.

“We had an early start … but lots of work is needed to consolidate our lead,” Wang added, meaning that the People’s Bank of China was one of the first major central banks, who began to analyze cryptocurrencies in 2014.

According to Wang, if Libra is tied predominantly to the US dollar, then the spread of this stablecoin will lead to increased dominance of the US dollar on the world currency market.

“If so, it would bring a series of economic, financial and even international political consequences.”