China’s digital currency racks up ‘a couple of million’ yuan of payments per day at the Beijing Winter Olympics

The Olympic trial is the first time visitors from overseas are free to use China’s digital currency via smartphones and wearable payment devices
No breakdown available for use among international attendees, though it ‘seems all the foreign users are using hardware wallets’, central bank says

China digital currency

Frank Tangin Beijing

Published: 10:15pm, 16 Feb 2022

Why you can trust SCMP

China’s sovereign digital currency, known as e-CNY, is catching international attention, with “a couple of million” yuan of payments being made each day in its latest trial during the Beijing Winter Olympics, a senior official with the People’s Bank of China (PBOC) has said.

China is leading the race among major economies to launch a digital currency and has rolled out pilot schemes in at least 10 cities across the country.

The Olympic trial is the first time visitors from overseas are free to use the e-yuan, which is available via smartphones and wearable payment devices such as gloves, badges and wristbands.

“I have a rough idea that [there were] several, or a couple of, million yuan of payments every day,” Mu Changchun, head of the PBOC’s digital currency research institute, told a webinar hosted by the Atlantic Council on Monday.

How close is China to launching its digital currency?

There was no breakdown of use among international attendees, though Mu said it “seems all the foreign users are using hardware wallets”, while Chinese were using software wallets.

China began looking into a digital currency in 2014, before Facebook’s plans to release a stablecoin called Libra, which has now been renamed as Diem, accelerated its development.

Pilot programmes have been launched in Beijing, Shanghai, Hainan, Suzhou, Chengdu, Xiongan, Changsha, Dalian, Xian and Qingdao.

At the end of December, 261 million digital wallets had been opened and the digital yuan was being accepted by more than 8 million merchants. Transactions totalled 87.6 billion yuan.

06:54

Is cryptocurrency too risky for China?

Digital wallets were available to download from app stores from the beginning of January.

Around 100 countries are exploring a central bank digital currency (CBDC), with the Bahamas the world’s first to issue a digital sovereign currency, called the Bahamas Sand dollar.

Kristalina Georgieva, managing director of the International Monetary Fund, said last week there was “no universal case for CBDCs because each economy is different”.

“So, central banks should tailor plans to their specific circumstances and needs,” she said in a speech.

“We are supporting countries in their CBDC experiments – to understand big picture trade-offs, to provide technical assistance, and to serve as a transmission line of learning and best practice across all 190 members.”

We’ll advance the e-CNY pilots with no preset timetable for the final launch

Mu Changchun

In its first-ever research report on a potential US digital currency, the Federal Reserve said a digital dollar would consolidate its international role, but it will not proceed without clear support from the executive branch and from Congress, ideally in the form of a law.

Many Chinese academics hope the digital currency will help promote more overseas use of the yuan. China has been collaborating with Hong Kong, Thailand and the United Arab Emirates to explore the use of digital money in international transactions.

However, the central bank is reluctant to give a clear timetable for its official launch.

“China is a big economy, so it’s very complex for us to develop such a complicated system. We’ll advance the e-CNY pilots with no preset timetable for the final launch,” Mu said at the webinar.

Criteria like user experience, security and efficiency will be closely watched, he added.