TronWeekly

Crypto World News

You are here: Home / Archives for Digital yuan

Digital yuan

Digital Yuan’s Cross-Border Soar: Hong Kong Trials Galore

by

China’s central bank digital currency, known as the digital yuan, is witnessing a growing adoption and an increase in use cases. However, it is important to note that despite this expansion, the digital yuan only accounts for a mere 0.16% of China’s overall monetary supply.

The country’s central bank governor, Yi Gang, reported that the digital yuan has facilitated transactions worth nearly $250 billion during the one-and-a-half-year period since its pilot launch. As of the end of June, the total value of transactions reached an impressive 1.8 trillion yuan.

During this time, approximately 950 million transactions were conducted through around 120 million digital yuan wallets, resulting in an average transaction amount of roughly $260.

Despite the significant progress, it is evident that there is still considerable room for growth. By the end of June, only $2.3 billion, equivalent to 16.5 billion digital yuan, was in circulation, accounting for just 0.16% of China’s monetary supply. This data was sourced from a July 19 report by Reuters.

The digital yuan’s adoption is particularly modest when compared to China’s vast population of 1.4 billion. While there have been a few trials in Hong Kong, the primary usage of the digital yuan remains within the domestic retail payments landscape.

In an effort to further enhance cross-border applications, the Bank of China Hong Kong initiated a trial of a cross-border payment scheme for its customers at select retail stores in Hong Kong. This move marks the third cross-border trial of the central bank digital currency in Hong Kong, as reported by the South China Morning Post on July 18.

Lagging Behind: Digital Yuan vs. Public Blockchains

Last year, the BOCHK ran a program encouraging customers to set up BOC e-CNY wallets, rewarding them with $14 (100 yuan) for use at the Hong Kong supermarket chain U Select.

To expand the potential use cases of the digital yuan, the central bank integrated smart contract functionality in January. However, despite these developments, the digital yuan’s value processed in transactions, amounting to $250 billion, represents an impressive 70% increase from the figure cited in August 2022.

Nonetheless, it is essential to recognize that the asset’s transaction value still lags significantly behind that of major public blockchains. For instance, in 2022, Bitcoin alone facilitated transactions worth $8.2 trillion, as reported by various sources.

In conclusion, while the asset’s adoption and use cases continue to grow, there is still a long way to go before it becomes a substantial part of China’s monetary landscape, especially when compared to other cryptocurrencies and traditional payment methods.

China takes its CBDC into the insurance industry

by

China has been making immense progress in terms of its central bank digital currency [CBDC]. While countries across the globe have just initiated the research phase of their native CBDC, China’s digital yuan is already being used by the public. After being employed across various sectors, the Chinese government has decided to induce the digital yuan into the insurance industry.

China took the lead in the development of CBDC and managed to get on a pedestal with its fast-paced approach. The latest news reveals how much progress the country has been making.

A news portal noted that the digital yuan had ventured into the insurance industry. This program is being carried out by a local branch of the People’s Bank of China [PBoC], and the policies were issued in Shenzhen, South China’s Guangdong Province. Shenzhen subsidiary of Pingan Property Insurance

China continues to stay ahead in the CBDC game

The first batch of the Chinese CBDC insurance policies was issued by the PBoC’s Shenzen branch. With its latest move, the central bank of the region along with the government hopes to expand the use of the digital yuan across several industries. Previously, the use of the CBDC was limited to merely e-commerce platforms and for online payments.

Speaking about the advancement of the digital yuan, Wang Peng, an assistant professor at the Gaoling School of Artificial Intelligence at the Renmin University of China stated,

“As more users get used to making payments with the digital yuan and the market matures, the application scenarios will be able to expand from the insurance industry to more scenarios such as financial services, life services, and even the purchase of funds and trading in securities.”

While the country has been making headway in this area, certain US senators recently expressed angst against the use of the digital yuan during the 2022 Olympics. The senators suggested that the Asian country would employ the digital yuan to surveil American athletes.

However, the country’s central bank, PBoC, hit back and released a statement that read,

“The US politicians should abide by the spirit stipulated in the Olympic Charter, stop making sports a political matter and stop making troubles out of the digital currency in China.”

USA Senators urge Olympic committee to leave out American athletes from employing digital yuan

by

With China hosting the 2022 Olympics, certain officials from the USA seemed concerned about American athletes using the Chinese central bank digital currencies [CBDC], the digital yuan during their time in the Asian country.

China took a massive plunge into the development of a national digital currency. China went on to become one of the first countries to develop and issue its very own CBDC. China’s fast-paced development of the digital yuan certainly caught the eyes of the world. Several countries did not want China to garner an upper hand in the financial sphere, which led them to instigate their very own research and development in the field.

With the digital yuan came an array of rumours surrounding the asset. Numerous officials noted that the Chinese government would be able to track and trace the finances of those using the asset. Keeping this in mind, three senators of the USA went on to write a letter to the Olympic officials urging them to keep the athletes representing the country from using the digital yuan.

USA athletes won’t be using the digital yuan?

The letter signed by Republican senators Marsha Blackburn, Roger Wicker and Cynthia Lummis noted that American athletes should be refrained from accepting or even using the Chinese CBDC.

The senators went on to express fear over how the Chinese Communist Party, along with the country’s central bank, the People’s Bank of China [PBoC], could use the digital yuan to keep an eye on athletes during their stay in the country and even after they revert to the USA.

Elaborating on the same, the senators wrote,

“The integration of China’s digital currency into global commerce has many problematic privacy implications. These concerns are especially pronounced given the Chinese Communist Party’s use of new and emerging technologies to suppress the Uyghur minority, the people of Hong Kong, and those across China who strive for freedom of expression. These concerns are not hypothetical. Rather, digital payment platforms such as WeChat, are already being used to surveil, threaten, and arrest Chinese citizens.”

Digital yuan adoption soars as Beijing subway announces support

by

China’s central bank digital currency [CBDC], the digital yuan, has been under the spotlight for quite a while. The Chinese government’s fast-paced development put the asset on a pedestal. The latest news from the country affirmed that the government has been sprucing up the adoption of the digital yuan.

While several governments speculated that China hastened the development of its CBDC to garner financial dominance, a few others believed that the country was going on a digitalization spree. Nevertheless, cautioned by China’s plunge into CBDCs, an array of governments followed suit as they focused on developing their very own CBDC.

China, however, proved that it was way ahead in the game as it elevated the presence of CBDCs by inducing them into its transport system.

Digital yuan takes the Beijing subway

A recent report revealed that users of the Beijing subway would use their digital yuan to get around. This would mean that the program would allow access to customers through 24 subway lines and four railway stations. While this initiative has already made its debut, it is reportedly limited to those with an Industrial and commercial bank of China bank accounts.

Elaborating on the functions of this program, a customer service representative of the Beijing rail transit network stated,

“You need to download a mobile APP that is linked with your bank account to access to the service.”

Furthermore, Beijing’s digital travel experience isn’t limited to this as the region hopes to induce digital yuan across various sectors.

Once home to the most prominent Bitcoin mining farms in the country, China has given up this title to Kazakhstan. With China taking down several crypto platforms across the country, it seems to be focusing on the advancement of the digital yuan. Earlier in June, about 3,000 ATMs in Beijing were made available for the withdrawal as well as the deposit of the Chinese CBDC.

Digital Yuan To Uphold Privacy By Supporting Anonymous Transactions

by

China’s central bank digital currency [CBDC], the digital yuan has been making headlines for quite a while now. The country’s plunge towards digitalization inspired an array of other countries to start developing their own digital asset. While China is well ahead in the game, all the other countries were trying to catch up.

Despite, the emergence of the digital yuan, rumors pertaining to the Chinese government controlling their citizens finances began surfacing. While privacy was a great concern of many citizens, with regard to the digital yuan, an official of the Chinese central bank affirmed that a certain magnitude of privacy would be given to those using the country’s CBDC.

Digital Yuan To Entail “Controllable Anonymity”

In a recent report by a local Chinese news portal, it was revealed that the People’s Bank of China [PBoC] intended to uphold privacy with the launch of the digital yuan. Speaking about the same at the 2021 China Development Forum, the head of the digital currency research institute of the People’s Bank of China, Mu Changchun, addressed the potentials of the country’s CBDC.

While suggesting that a entirely anonymous CBDC was out of the picture, Mu pointed out that it wouldn’t be very feasible. Since the Chinese currency would soon be used throughout the country as a national currency,it needs to come under certain anti-money laundering, anti-tax evasion as well as counter-terrorist financing procedures. However, privacy would still find its place, Mu announced.

Limited anonymity would be available, revealed the official. The PBoC will reportedly permit anonymous digital yuan transactions, however, in dainty amounts. He added,

“The digital renminbi adopts a design of small amounts anonymous, keeping large amounts traceable. In short, the protection of user privacy by digital renminbi is the highest among the current payment tools.”

Additionally, the digital yuan is already out and about for testing. The PBoC has been testing the Chinese CBDC on various platforms across the globe.

China’s Digital Yuan Sees 20K Transactions Within 24-Hrs On E-commerce Platform

by

China’s new sovereign digital currency, Digital Yuan has become a hot topic around the world. In the latest development, close to 20,000 transactions were paid for with Digital Yuan within 24 hours through e-commerce company JD.com as it conducted a real-world trial.

The residents of the country actively participated in the trial of its digital currency in Suzhou, a city in East China’s Jiangsu Province and the largest online payment reportedly surpassed 10,000 Yua 80% of the participants for the trial were made by the younger generation who were born between 1980-1990.

JD.com was not the only platform that participated in the trial. There were nearly 10,000 physical shops in Suzhou that took part in the real-world trial for Digital Yuan at the “Double Twelve” shopping festival.

Cao Yin, who happens to be the Managing Director of the Digital Renaissance Foundation in Shanghai was quoted saying,

“As far as I know, the PBC is also hiring talent from a lot of private digital currency firms and internet companies to develop the digital currency. It hopes to implement the digital yuan using market-oriented means”

However, despite the fact that China has become the frontrunner in developing its central bank’s digital currency [CBDC] as it is currently deploying it on major e-commerce platforms within the country, the process has been cautious and not hasty. And it was something that Yin himself stressed.

Scaling Digital Yuan

China is gearing up for the implementing Digital Yuan on a massive scale and was looking to use the digital currency at the 2022 Winter Olympic Games.

This was part of the pilot programs launched by the People’s Bank of China back in April in cities such as Shenzhen, Chengdu, Suzhou, and Xiongan. Till last month, the programs had conducted more than 4 million transactions, which roughly totaled to $300 million,

Previously, reports regarding Hong Kong’s central bank working with the People’s Bank of China for the trial use of the Digital Yuan emerged. This was the first instance of China’s central bank digital currency’s use outside the country, this initiative was for the purpose of cross-border payments.

China’s Stance on Cryptocurrency Remains Critical As New Details Emerge

by

China has been sitting in the driver seat when it comes to leading blockchain technology and bolstering towards the relentless global domination quest of its national currency. But things become complicated when there is “virtual currency” or cryptocurrency in the picture.

According to the latest development, selling crypto purchased with the Renminbi [RMB] to withdraw foreign currency could be considered money laundering. In addition to that, selling crypto purchased with foreign currency to withdraw RMB could also likely be deemed money laundering.

The report was loosely translated from the Chinese media platform, People’s Daily which explicitly stated,

“The holder buys “virtual currency” in China by paying in RMB, and then sells it in foreign currency in any form, or the holder buys “virtual currency” overseas by paying in foreign currency, and then passes any The form of selling and cash withdrawal is RMB. Under the above-mentioned circumstances, no matter how many currency-to-currency transactions are converted between buying and selling, it essentially violates China’s foreign exchange control regulations and is suspected of money laundering crime”

The report further went on to mention that if a Chinese citizen sells and cashes out “virtual currency”, regardless of the region and currency, as long as there is a profit, the individual must declare personal income tax to the Chinese tax authority. If the tax declaration is not filed, it could be suspected of Tax evasion.

Cryptocurrency Rules in China

According to the Library of Congress, China does not recognize cryptocurrencies as legal tender. The country’s banking system does not accept cryptocurrencies or provide relevant services. Notably, China has carried out a series of regulatory measures to crack down on activities related to the crypto industry citing the reasons as investor protection and financial risk prevention.

Those measures include announcing that initial coin offerings [ICOs] as illegal and restricting the primary business of cryptocurrency trading platforms. Despite the fact that China dominates the Bitcoin mining scene, the government has also discouraged mining in the country.

Digital Yuan

China’s stance on cryptocurrencies, in general, might be strict but not when it comes to digitizing its national currency. Its digital yuan pilot program has been picking up the pace which was rolled out for extended testing in four cities. According to reports, there have been more than 4 million transactions, totaling over 2 billion Yuan or $299 million in the digital currency so far.

Chinese Central Bank Seeks Public Advice In Amending Banking Law For Its CBDC

by

Yet again, China has made it clear to the world that the central bank’s digital currency has been winning in its development and issuance. China seems to be well ahead of the CBDC game, though being first in the game has its own perks. The Asian country’s latest news revealed that progress has been made in the digital yuan regulatory sector.

Digital Yuan, Not Yuan-Pegged Tokens

A recent notice issued by the People’s Bank of China, the central bank of the world’s most populous country affirmed that the bank and the government were inclined towards regulating the digital yuan and banning yuan-pegged digital assets. Through the notice, the Chinese central bank sought feedback from the public to make amends to the existing central banking law. The bank urged people to send in their feedback for the alteration of the draft before 23 November 2020.

China’s CBDC development turned several heads. With some lauding the country’s pace in the development of the digital yuan, a few others alerted the Chinese citizens that this asset would take away financial privacy. However, the country seems to be emphasizing outlawing yuan-pegged assets.

The law put forth with regard to digital assets suggests that the Renminbi encompassed both a physical as well as a digital form. Section 3 under article 22 in the revision draft proposed that any legal entity or an individual was prohibited to sell or issue tokens that impacted or replaced the circulation of the Renminbi. The revised draft further read,

“For anyone that violates such regulation, the PBoC will halt such activities and forfeit any proceed from the making and selling of yuan-backed digital tokens and issue a fine that is up to five times of the involved proceeds.”

The latest news proves that digital yuan would soon be a part of the global financial scene. However, the fact that the country is steering towards outlawing yuan-pegged stablecoins could be a major drawback for the several platforms that the country currently harbors.

China’s Blockchain and Fintech Superiority Might Oust America-led Global financial System, Says Ripple Co-founder

by

China leads the world in terms of blockchain and fintech, while the US dollar is the reserve currency of the world. The United States has drawn a lot of criticism from industry experts for its inaction on cryptocurrency and blockchain technology. The latest person to comment on this subject is the co-founder of Ripple, Chris Larsen.

The co-founder and executive chairman of Ripple, Chris Larsen, published an op-ed piece arguing that the United States and China are drawn in a “technology cold war.” According to Larsen, the fact that Chinese miners control about 65 percent of the Bitcoin hash rate, they can gain complete control of the Bitcoin network in future. Moreover, the Ripple co-founder urged U.S. authorities to work in collaboration with blockchain and crypto firms in the country.

China’s blockchain and fintech supremacy

In Larsen’s argument, the superiority of China in blockchain and financial technology might be a significant catalyst to future conflicts between the two economic heavyweights. Furthermore, Larsen claims the U.S. dollar might lose its status as the world’s reserve currency in the wake of digital currencies, digital wallets, blockchain technology and interoperability procedures.

With China leading the world in the fronts as mentioned above, Larsen argues it creates a possibility for the nation to overtake the traditional financial system powered by the U.S. dollar through digital payments such as crypto-assets such as the digital yuan. In his piece, Larsen noted:

“For China, this is a once-in-a-century opportunity to wrest away American stewardship of the global financial system, including its ultimate goal of replacing the dollar with a digital yuan.” 

Can the Chinese reverse Bitcoin transactions?

According to a study conducted by the University of Cambridge Centre for Alternative Finance, 65 percent of all cryptocurrency mining operations take place in China. In Larsen’s argument, if the United States loses financial superiority to China, it could threaten digital currencies. He argues that the Chinese could take advantage of the accumulated hash power to influence crypto transactions.

China and the United States are currently embroiled in a battle surrounding technology advancement. Notably, the two companies are battling on the upcoming 5G technology. Chinese firms have been pushing aggressively to have a bite of the American telecom market. Still, U.S. authorities have put in place barriers to the Chinese, citing matters of national security.

Chinese Blockchain Industry Flourishing Despite the Economic Impact of Covid-19 with Over 10,000 New Firms Registered in 2020

by

The Chinese blockchain industry is still flourishing, given the economic impact of the coronavirus pandemic. The Chinese authorities have licensed more than 10,000 new blockchain firms so far in 2020, according to blockchain analytics firm LongHash. Most of these businesses have business assets worth as little as 5,000 yuan.

Notably, with about half of the year remaining, the number of new registrations in China this year is the third-highest, only eclipsed by the previous two years. China saw its highest number of new blockchain firms set up back in 2018, hitting the same highs again in 2019. However, given the current rate of growth in the Chinese blockchain sector, the number of new registrations will exceed the year before, as per the analytics firm.

Blockchain firms closing down in China

There are currently a total of 84,410 registered blockchain firms in china. Out of this massive figure, only 29,340 firms are operational. Most of these new firms are based in the Chinese province of Guangdong, followed by the southwestern province of Yunnan.

Notably, most of these blockchain startups were established using small capitals as per the analytics firm. The majority of these blockchain startups were registered with only 5,000 yuan (about $719). Nevertheless, a small number of startups have a registered operating capital of more than 50,000 yuan ($7,175).

Chinese blockchain industry growing despite China banning crypto trading

Even though the Chinese authorities prohibited crypto trading and ICOs three years ago, the Chinese blockchain industry is still accelerating. The industry is instead growing substantially. Indeed, early this year, the Chinese congress reviewed a national blockchain fund bill that aims to promote innovation in the sector.

Furthermore, China has a total of 224 recognized blockchain projects which involve technology behemoths such as Walmart and Baidu. Interestingly, the PBoC is also on the verge of issuing digital yuan, while also participating in a variety of other blockchain-related projects.