China CBDC Reaches Milestone of Nearly $14 billion Transactions

China CBDC Reaches Milestone of Nearly $14 billion Transactions.

The Chinese central bank’s digital currency project (CBDC) has reached the milestone of making 100.04 billion yuan in transactions during its pilot phase.  As a result, the digital yuan, or e-CNY, has become the most widely adopted CBDC in the world.

More Than 5.6 million Merchant Stores Support The Digital Yuan

In a post on its official WeChat page on Oct. 10, the Bank of China reported that 360 million transactions had been processed in 15 provinces under the CBDC pilot program by the end of the summer.

According to the article, 5.6 million merchants already accept the digital yuan as legal tender.

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A wide range of citizen payments are being covered by the pilot, including payments made by some state institutions as well.

“Multiple e-government service platforms have opened digital renminbi payment services, supporting online and offline channels to handle various public utility payments, using digital renminbi to issue tax rebate funds, special funds for monthly medical insurance payment, funds for helping people in need, and ‘specialized, special and new’ enterprise support funds, etc.” 

A CBDC trial launched by China’s central bank in April 2020 aims to eventually replace cash with digital currency.

Launches The Cross-border Payment Between China and Hongkong

As part of project development, the financial regulator plans to launch cross-border payments between Hong Kong and mainland China.

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The bank is actively exploring the multilateral cross-border option in coordination with the Bank for International Settlement, observing the principle of “anonymity for small amounts and traceability for large amounts” to protect the user’s privacy.

In addition, it shared plans to expand the e-CNY deployment to four provinces in 2022, including Guangdong.

It is interesting to note that the Bank of China reported transactions worth $13 billion by January 2022, with the updated information meaning that overall new transactions didn’t exceed $1 billion in the last seven months.

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Jamilatul Mahmudah

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