China’s digital yuan tipped for wider application, while authorities down play privacy fears
- Potential application of the digital yuan could be expanded to the transfer of government funds and as a way of monitoring illegal transactions, researcher says
- Mu Changchun, head of the central bank’s digital currency research institute, says any scrutiny of e-CNY transactions will be ‘strictly in line with laws and regulations’
China should expand payment applications for its digital yuan to areas such as the allocation of government funding, while leveraging its potential to trace money flows to crack down on embezzlement and corruption, a government researcher said on Monday.
“The application scenarios for the digital yuan could be expanded in the future,” said Hong Yong, a fellow with the Ministry of Commerce’s research institute.
“For the distribution of poverty alleviation or demolition funds, [while] the traceability of the digital currency can be used to effectively deter and combat payment deduction and corruption,” he told the People’s Daily, a Communist Party mouthpiece, as anticipation grows about the full-scale launch of the e-CNY.
China has pioneered development of the central bank digital currency, with a research institute chartered in 2016 and trials across the country that have involved hundreds of millions of people.