11 things you may not know about China’s digital currency

China was the first major economy to begin exploring its own digital currency in 2014, though it is yet to launch the proposed digital yuan
Unlike cryptocurrencies such as bitcoin, which are not centrally controlled, China’s “sovereign” digital coin would fall under the authority of the People’s Bank of China

China digital currency

SCMP Reporters

Published: 12:19pm, 30 Mar, 2021

Why you can trust SCMP

1. What is China’s sovereign digital currency?

The so-called Digital Currency Electronic Payment (DCEP), has yet to launched in 2020. Learn more

Alibaba’s Alipay and Tencent’s WeChat Pay are already popular payment methods in China. Photo: EPA

2. Which central bank will launch world’s first digital currency?

China has made rapid progress while other nations are also at various stages of research and development. Learn more

A number of central banks are at various stages in creating and testing sovereign digital currencies. Image: SCMP Graphics

3. Are there data and privacy protection concerns?

China’s central bank is trying to allay privacy worries by promising “controllable anonymity”. Learn more

Mu Changchun, from the People’s Bank of China, says the nation’s digital currency will feature “controllable anonymity’” Photo: Handout

4. What does China’s SWIFT joint venture mean for its digital currency?

Finance Gateway Information Service was registered in Beijing in February with €10 million (US$12 million) as incorporation capital. Learn more

There is no official timetable for the launch of China’s digital yuan despite various pilot programmes in the cities of Shenzhen, Suzhou, Xiongan and Chengdu. Photo: JD.com

5. Is China’s digital currency set for launch?

People’s Bank of China governor Yi Gang said “there’s no timetable for an official launch” of China's sovereign digital currency. Learn more

People’s Bank of China chief Yi Gang said China had “basically completed” the top-level design, standard setting, research on functions and integration tests of the digital yuan. Photo: Bloomberg

6. Is China’s digital currency a threat to global monetary systems?

Beijing is not seeking to replace existing currencies with its digital yuan, according to former People’s Bank of China governor Zhou Xiaochuan. Learn more

Zhou Xiaochuan, the former governor of the People’s Bank of China, is an advocate for Beijing’s digital currency plan. Photo: EPA-EFE

7. What did large-scale test by four state-owned banks mean for China's digital currency?

China’s big four state-owned commercial banks started large-scale internal testing in August. Learn more

China’s digital currency would be a competitor to existing payment services including Alipay and WeChat Pay, which have so far dominated mobile payments in China. Photo: Simon Song

8. Have some business owners been reluctant to participate in pilot programmes?

Some businesses in Suzhou were reluctant, but were told, “a merchant but cannot decline payment in e-yuan”. Learn more

Li Lan, who won a 200-yuan red packet in Suzhou’s e-yuan test, scans a QR code with her smartphone to make a payment at an electronics shop. Photo: Orange Wang

9. How much did Shenzhen consumers spend during the largest trial of digital yuan?

Over 47,000 consumers spent 8.8 million yuan (US$1.3 million) during a week-long trial of China’s sovereign digital currency. Learn more

China’s sovereign digital currency is entering an already very crowded payments market in China, with the likes of WeChat Pay and Alipay already dominating the sector. Photo: Reuters

10. Which US food outlets were included in the digital currency tests?

China included McDonald’s, Starbucks, Subway on list of foreign firms to test digital currency. Learn more

American chains Starbucks, McDonald’s and Subway were named on the People’s Bank of China’s list of firms that will test the digital currency in small transactions with 19 local businesses. Photo: Bloomberg

11. How much of China’s digital currency was distributed during the second trial in Shenzhen?

A total of 100,000 digital “red packets”, each containing 200 yuan (US$31), were distributed to residents. Learn more