China’s pilot of the central bank digital currency has made promising progress. However, the digital RMB system collects and shares less transaction information than traditional electronic payments according to a PBOC digital RMB white paper.
August 21, 2021 | Wendy Weng- China’s digital RMB is a centralised, cash-like digital currency issued and controlled by the PBOC based on a two-tier operating system
- Nearly 21 million personal and 3.5 million corporate digital RMB wallets have been issued during the pilot phase
- The PBOC has given away over $49 million worth of digital RMB “red packets” or coupons as part of digital currency trial since October 2020
Despite being in its pilot phase, China’s digital renminbi (RMB) has been used in 70.75 million transactions totalling RMB 34.5 billion ($5.3 billion) by the end of June 2021. This is according to a white paper released by the People’s Bank of China (PBOC) in July 2021. The numbers are significantly higher than the 3.13 million transactions worth RMB 1.1 billion ($162m) recorded in August 2020 said PBOC’s deputy governor Fan Yifei.
China began exploring its own central bank digital currency (CBDC) in 2014. In its first white paper on the digital currency, the PBOC revealed that the programme now spans the Yangtze River Delta, Pearl River Delta, Beijing-Tianjin-Hebei, and China’s central, western, northeastern and northwestern regions. The PBOC initially launched the pilot in Shenzhen, Suzhou, Xiong’an, and Chengdu at the end of 2019. Shanghai, Hainan, Changsha, Xi’an, Qingdao and Dalian were added from November 2020 and will also include the 2022 Beijing Winter Olympics.
“As the top-level design, function development, and system testing have been completed, the PBOC initiated pilot programme in some representative regions, while making sure the pilot is run and managed in a steady, safe, innovative and practical manner,” the PBOC said in the white paper.
Designed as a substitute for cash in circulation (M0), digital RMB primarily serves domestic retail payment, is settled upon payment, and ...
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