China’s central bank is betting big on cryptocurrencies as it gets ready to launch its very own digital currency. According to the head of the PBOC’s digital currency research institute, Mu Changchun, the launch of China’s digitized domestic currency could generate a “horse race” as other banks and financial institutions compete with each other to roll out services that accommodate this currency.

China’s Digital Currency Electronic Payment (DCEP) project is the next big thing to shake the crypto market, after the news about Facebook’s plans to roll out its own digital currency initiative, Libra. The PBOC is planning to launch its digital currency in two stages – starting with issuing the digital currency to commercial banks and other financial institutions first, and then offering it openly to the public at large.

Aimed at substituting physical currency, this new currency’s holders will not benefit from interest payments, which could subsequently eliminate any impact of monetary policy or inflation on its valuation. China has undertaken this massive initiative towards digitized currencies in order to check illegal cash flows via new, emerging technologies in global payments systems.

On the positive side, the digital currency would offer improved regulatory oversight over money flows. Mu also welcomed other stable coins into the Chinese markets as long as they abide by all forex rules enforced by the government in Beijing.