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BIS head Carstens: China’s clearing and settlement service is no substitute for global Swift system
Chinese yuan playing ‘complementary’ role in interbank settlement, but CIPS won’t rival Swift, says global central bank boss
- China’s clearing and settlement service is no substitute for the global payment system Swift, says Agustin Carstens of Bank of International Settlements
- Digital central bank currencies will enhance efficiency but must be developed with care, while cryptocurrency is ‘not money’ and must be regulated, he says
As the yuan is now the world’s fifth most used currency for payments by value, the Chinese central bank clearing system is playing an important complementary role in the global payment system, according to the boss of the global central bank.
“In this space, it is not probably adequate to think about substitutes,” Carstens said. “It is not a race. Swift covers some forms of payments initiated by different types of intermediaries, while other systems could cover others. The important thing here is the complementarity of the different payment systems.
“There are many needs among societies, and we need to let the different solutions flourish.”

The yuan now has a 2.13 per cent of the market share in global payments by value as of October, according to Swift. That is ahead of the Canadian dollar at 1.75 per cent and the Australian dollar at 1.33 per cent, but behind the Japanese yen at 2.95 per cent, the British pound at 7.85 per cent, the euro at 34.43 per cent and the US dollar at 42.05 per cent.

He also supports efforts, like those in Hong Kong, to regulate cryptocurrencies, which he said are “not money” but “speculative assets” that require proper regulation to safeguard investors.
A BIS survey last year found that 86 per cent of 65 central banks were researching the potential for CBDCs, with one-fifth of the world’s population likely to see a sovereign digital currency in the next three years.
What does Hong Kong mean by virtual assets?
“We have been exploring [CBDC] which is at the core of the monetary system,” Carstens said.
Since a CBDC has exposure at both the wholesale and retail levels, these projects face many concerns, such as cybersecurity, Carstens said.
“CBDC just cannot fail,” he said. “Imagine a world in an economy that depends on CBDC. It would be tremendously bad for the central bank if at some point the system is down. Therefore, we need to anticipate many different aspects of the project.”
Hong Kong’s main lesson from FTX’s collapse? More regulation is needed
As different central banks are developing CBDCs alone or in different groups, he does not believe there will be a global blueprint.
“We really want to have a standard, though, or at least a minimum amount of agreement among the different central banks, to assure the interconnectedness, to assure that the different systems talk to each other,” he said. “And that would allow seamless payments across borders” both at the retail and wholesale levels.
The Hong Kong government is keen on introducing proper regulations to develop the city as a digital asset hub, even after cryptocurrency exchange FTX filed for bankruptcy with debt in the billions of US dollars.
“These events remind us that many of these cryptocurrencies are not really currencies,” Carstens said. “They are not money. Money implies a vehicle that is a good means of payment with deposit of value and good unit of account. These cryptocurrencies have not fulfilled those roles at the base, they have been speculative assets.”
He thus said regulation will be important, as many of these failure cases showed.
“We need to beef up the regulatory aspects,” he said. “It is very important to have investor protection guidelines. What is very regretful is that in many of these experiments, we have found up to millions of people are affected. Therefore, that is an issue that from a public policy point of view certainly requires to be addressed.”
