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The use of the digital yuan at the Winter Olympics signals the culmination of a development that started in 2020 for China.
The officials of China recently announced plans to allow the use of digital yuan at the upcoming 2022 Beijing Winter Olympics. The announcement comes ahead of China’s plans to unveil a CBDC. The Beijing Winter Olympics shall serve as a testing ground for the digital Yuan and shows China’s continuing dedication to exploring digital currency.
The aim is for foreign athletes and visitors to be able to use the currency for transactions. As the deputy governor of the People’s Bank of China Li Bo, said at a CNBC panel at the Boao Forum for Asia on Sunday, “for the upcoming Beijing Winter Olympics, we were trying to make e-CNY available not only to domestic users but also to international athletes and like visitors”.
The People’s Bank of China has been immensely focused on the digital currency space for a while. Since 2020, they have been making plans to implement CBDC into their nation’s economy. However, they continue to insist that the CBDC is not a replacement for the fiat currency or meant to replace the US dollar on an international scale.
The Digital Yuan, as the CBDC is known, is going to be a supplementary domestic currency when it is released. However, the Peoples Bank of China has remarked that they view the major cryptocurrency Bitcoin as a model and investment alternative for their digital currency.
China isn’t the only country that has started looking at CBDCs or central bank digital currencies as an alternative to fiat currency. World powers like Russia, Thailand, Japan, Turkey, and EU countries have all made plans to implement digital currency models into their economies.
However, the US continues to adopt a hostile policy towards digital currency despite this seeming mass adoption, citing the security inadequacies and opportunity for fraud presented by digital currency. Though, proponents of CBDCs remain concerned that the US not adopting digital currency-friendly policies can harm the global economy and the US dollar.
The use of the digital yuan at the Winter Olympics 2022 signals the culmination of a development that started in 2020 for China. With several developments in the pipeline and an already working cross-border pilot with Hong Kong and the United Arab Emirates, with more countries on the possible list. Chinese authorities continue to stress they do not intend to challenge the US dollar as currency, maintaining that they shall continue to rely on the dollar, unlike other countries using the CBDC policy who are trying to lessen their reliance on the dollar.