Gaining Currency
Article

Gaining Currency

Is China's digital yuan finally taking off?

Rachel Cheung
The Wire China, 2024
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China unveiled the digital yuan at the 2022 Winter Olympic Games in Beijing. Yet despite its sluggish roll-out, China’s leadership remains committed to advancing the digital currency as the country’s primary form of payment and exchange. Journalist Rachel Cheung offers an examination of the digital yuan and its impact on China’s economy and on the global financial ecosystem. Executives and investors will find this a robust assessment of central bank digital currencies and China’s role in advancing the worldwide payment architecture.

Summary

In 2022, China became the first nation to launch a central bank digital currency (CBDC), the digital yuan.

The movement toward sovereign CBDCs began in 2014 and gained momentum in 2019 when Facebook introduced the plans for its cryptocurrency, the “Libra Coin.” For Chinese officials, the Libra — a stablecoin tethered to the US dollar — represented a threat to China’s long-term economic and political dynamism. But the Libra never materialized. China intended its digital yuan to counter the dominance of the US dollar as a reserve currency and of cryptocurrencies. China prohibited all cryptocurrencies in 2021, while launching the architecture of the digital yuan and its delivery system “e-CNY.”

China’s leadership...

About the Author

Rachel Cheung is a staff writer for The Wire China.

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