Digital renminbi

{{short description|Digital currency issued by China's central bank}} {{Infobox currency | currency_name = Digital Currency Electronic Payment {{lang|zh-Hans-CN|数字货币电子支付}} | name_abbr = e-CNY | image_1 = E Yuan logo.svg | image_alt_1 = The digital renminbi logo features the Yen sign. The yen sign is surrounded by the lower-case Latin letter E, like in electronic. The horizontal line of the E and the top horizontal of the ¥ are the same line. The color of the symbol is a slightly darker red. | image_width_1 = 140px | image_title_1 = Digital Renminbi / e Yuan Sign | iso_code = CNY | unit = ''yuán'' ({{lang|zh|元}} / {{lang|zh|圆}}) | no_plural = Y | symbol = 14px or {{small|e¥ / ¥ }} | nickname = Digital renminbi ({{lang|zh-Hans-CN|数字人民币}}) | subunit_ratio_1 = {{frac|10}} | subunit_ratio_2 = {{frac|100}} | subunit_name_1 = ''jiǎo'' ({{lang|zh|角}}) | subunit_name_2 = ''fēn'' ({{lang|zh|分}}) | date_of_introduction = {{start date and age|df=y|14 August 2020}} | using_countries = {{PRC}} (Mainland China) {{small| Shenzhen, Suzhou, Xiong'an, Chengdu, Beijing, Zhangjiakou, Shanghai, Hainan, Changsha, Xi'an, Qingdao, Dalian, Fuzhou, Xiamen, Guangzhou, Tianjin, Chongqing, Hangzhou, Ningbo, Wenzhou, Huzhou, Shaoxing, Jinhua, Jinan, Nanning, Kunming, Fangchenggang, Xishuangbanna }} | unofficial_users = {{flag|Hong Kong}} {{flag|Macau}} {{small|(pilot test)}} | issuing_authority = People's Bank of China | issuing_authority_website = {{URL|http://www.pbc.gov.cn/}} | printer = People's Bank of China Digital Currency Research Institute | printer_website = {{URL|https://pilot.app.ecny.pbcdci.cn/download/index.html|www.ecny.pbcdci.cn}} | inflation_rate = 2.5% {{small|(2017)}} | value = 1 USD = 7.171 eCNY 1 EUR = 6.960 eCNY 1 CNY = 1.000 eCNY 1 GBP = 7.946 eCNY {{small| (12 October 2022)}} | pegged_with = {{flagd|China|size=20px}} Chinese renminbi (at par) }}'''Digital renminbi''' ({{lang-zh|数字人民币}}; also abbreviated as '''digital RMB''' and '''e-CNY'''),<ref>{{Cite news|date=2021-03-01|title=China Charges Ahead With a National Digital Currency|language=en-US|work=The New York Times|url=https://www.nytimes.com/2021/03/01/technology/china-national-digital-currency.html|access-date=2021-09-02|issn=0362-4331}}</ref> or '''Digital Currency Electronic Payment''' ('''DCEP''', {{zh|c=数字货币电子支付|p= Shùzì huòbì diànzǐ zhīfù|links=no}}), is a central bank digital currency issued by China's central bank, the People's Bank of China.<ref name=":0">{{Cite news|last=Areddy|first=James T.|date=2021-04-05|title=China Creates its Own Digital Currency, a First for Major Economy|language=en-US|work=Wall Street Journal|url=https://www.wsj.com/articles/china-creates-its-own-digital-currency-a-first-for-major-economy-11617634118|access-date=2021-04-06|issn=0099-9660}}</ref> It is the first digital currency to be issued by a major economy, undergoing public testing as of April 2021.<ref name=":0" /><ref>{{Cite news|last1=Popper|first1=Nathaniel|last2=Li|first2=Cao|date=2021-03-01|title=China Charges Ahead With a National Digital Currency|language=en-US|work=The New York Times|url=https://www.nytimes.com/2021/03/01/technology/china-national-digital-currency.html|access-date=2021-04-06|issn=0362-4331}}</ref> The digital RMB is legal tender<ref name=":3">{{Cite web|title=解码数字人民币："新"在何处用在哪里？-新华网|url=http://www.xinhuanet.com/info/2021-02/10/c_139734595.htm|access-date=2021-04-06|website=www.xinhuanet.com}}</ref> and has equivalent value to other forms of renminbi, also known as the Chinese yuan (CNY), such as bills and coins.<ref name=":0" />

The digital yuan is designed to move instantaneously in both domestic and international transactions.<ref name=":0" /><ref name= digitalAssetBourse >Bloomberg [https://slashdot.org/story/21/11/26/1757246/china-looks-to-set-up-digital-asset-bourse-in-virtual-yuan-push (26 Nov 2021) China Looks To Set Up Digital Asset Bourse in Virtual Yuan Push ]</ref> It aims to be cheaper and faster than existing financial transactions.<ref name=":0" /> The technology enables transactions to take place between two offline devices.<ref name=":1">{{Cite web|title=Virtual control: the agenda behind China's new digital currency|url=https://www.ft.com/content/7511809e-827e-4526-81ad-ae83f405f623|url-status=live|access-date=2021-04-06|website=www.ft.com|archive-url=https://web.archive.org/web/20210217050310/https://www.ft.com/content/7511809e-827e-4526-81ad-ae83f405f623 |archive-date=2021-02-17 }}</ref><ref name=":5">{{Cite web|title=Beijing's digital yuan policy will have its Huawei moment|url=https://asia.nikkei.com/Spotlight/Comment/Beijing-s-digital-yuan-policy-will-have-its-Huawei-moment|access-date=2021-04-09|website=Nikkei Asia|language=en-GB}}</ref>

The digital renminbi is seen by some commentators as a form of Chinese government surveillance and control over users and their financial transactions.<ref name=":0" /><ref name="ft.c_Virtual_control" />

== History == {{CSS image crop |Image = DCEP available In Shenzhen.jpg |bSize = 250 |cWidth = 250 |cHeight = 200 |oTop = 100 |oLeft = 0 |Location = right |Description = A sign showing that a store accepts digital RMB in Shenzhen, Guangdong }} China's central bank, the People's Bank of China (PBOC), began research on the digital currency in 2014 under the leadership of Governor Zhou Xiaochuan.<ref name=":2">{{Cite news|last=Cheng|first=Jonathan|date=2020-04-20|title=China Rolls Out Pilot Test of Digital Currency|language=en-US|work=Wall Street Journal|url=https://www.wsj.com/articles/china-rolls-out-pilot-test-of-digital-currency-11587385339|access-date=2021-04-06|issn=0099-9660}}</ref><ref name=":0" /> In 2016, Fan Yifei, a deputy governor of the PBOC, wrote that "the conditions are ripe for digital currencies, which can reduce operating costs, increase efficiency and enable a wide range of new applications".<ref name="nytimes.com">{{cite news|url=https://www.nytimes.com/2016/10/12/business/dealbook/central-banks-consider-bitcoins-technology-if-not-bitcoin.html|title=Central Banks Consider Bitcoin's Technology, if Not Bitcoin|newspaper=The New York Times |first=Nathaniel |last=Popper |date=October 11, 2016 |access-date=2017-01-05}}</ref> According to Fan, the best way to take advantage of the situation is for central banks to take the lead, both in supervising private digital currencies and in developing digital legal tender of their own.<ref>{{cite web|url=https://www.bloomberg.com/view/articles/2016-09-01/on-digital-currencies-central-banks-should-lead |title=On Digital Currencies, Central Banks Should Lead |work=Bloomberg |date=September 1, 2016 |first=Fan |last=Yifei |access-date=2017-01-05}}</ref>

In 2017, the State Council approved the development of the digital RMB, in partnership with commercial banks and other organizations.<ref name=":8">{{Cite web|last=Wu|first=Yu|date=2020-08-15|title=别误读了！目前数字人民币试点仍是"4+1"-新华网|url=http://www.xinhuanet.com/fortune/2020-08/15/c_1126372237.htm|url-status=live|access-date=2021-05-02|website=Xinhua|archive-url=https://web.archive.org/web/20210126023537/http://www.xinhuanet.com/fortune/2020-08/15/c_1126372237.htm |archive-date=2021-01-26 }}</ref> Chinese technology firms such as Alibaba (through its affiliate Ant Group), Tencent (which owns WeChat), Huawei, JD.com and UnionPay were invited to cooperate with the central bank in developing and testing the digital RMB.<ref>{{Cite web|date=2021-04-26|title=Ant Group shows off its work on China's digital currency for the first time|url=https://www.scmp.com/tech/big-tech/article/3131071/china-digital-currency-fintech-giant-ant-group-reveals-partnership|access-date=2021-05-02|website=South China Morning Post|language=en}}</ref><ref>{{Cite web|last=Castillo|first=Michael del|title=Alibaba, Tencent, Five Others To Receive First Chinese Government Cryptocurrency|url=https://www.forbes.com/sites/michaeldelcastillo/2019/08/27/alibaba-tencent-five-others-to-recieve-first-chinese-government-cryptocurrency/|date=August 27, 2019|access-date=2021-09-02|website=Forbes|language=en}}</ref>

In October 2019, the PBOC announced that a digital renminbi would be released after years of preparation.<ref name="nikkeiasia-20191231">{{cite news |url=https://asia.nikkei.com/Business/Markets/Currencies/China-s-digital-yuan-takes-shape-with-new-encryption-law |title=China's digital yuan takes shape with new encryption law |last=Tabeta |first=Shunsuke |website=Nikkei Asia |date=31 December 2019 |access-date=11 October 2020}}</ref> The version of the currency, known as DCEP (Digital Currency Electronic Payment),<ref>{{Cite web|url=https://www.hkma.gov.hk/eng/news-and-media/press-releases/2019/11/20191106-3/|title=Hong Kong Monetary Authority - Hong Kong FinTech Week 2019|last=Authority|first=Hong Kong Monetary|website=Hong Kong Monetary Authority|language=en|access-date=2019-11-10}}</ref> requires an account with a commercial bank, but may be "decoupled" from the banking system in the future, allowing tourists to gain access to the system.<ref>{{Cite web|url=https://www.scmp.com/business/banking-finance/article/3036543/chinas-digital-currency-tsar-says-e-payment-platforms-may|title=Digital yuan tsar gives green light for tourists to go cashless in China|date=2019-11-06|website=South China Morning Post|language=en|access-date=2019-11-10}}</ref>

=== Testing === ==== 2020 ==== In April 2020, testing began in four cities around China (Shenzhen, Suzhou, Chengdu and Xiong'an) to improve the currency's functionality.<ref name=":2" /><ref name=":8" /> Areas of testing include the currency's reliability, stability, ease of use, and regulatory concerns such as the prevention of money laundering, tax evasion and terror financing.<ref name=":8" /> The currency could be transferred to bank accounts or used directly with certain merchants, and could be controlled via apps on one's smartphone.<ref name=":2" /> As of April 2021, more than 100,000 have downloaded such apps, which were developed by banks, including six state-owned banks.<ref name=":0" /><ref name=":4">{{Cite web|title=四城七轮数字人民币红包累计已发1.5亿元-新华网|url=http://www.xinhuanet.com/fortune/2021-02/25/c_1127136309.htm|access-date=2021-04-09|website=www.xinhuanet.com}}</ref> The digital currency could be spent in stores like Starbucks and McDonald's in China, as well as online shopping platforms like JD.com.<ref name=":0" /><ref name=":4" /> Local governments, partnering with private businesses, have distributed more than 150 million RMB as an incentive to attract test users of digital RMB and to stimulate consumption.<ref name=":3" /><ref name=":4" />

==== 2021 ==== As of April 2021, testing has been expanded to six additional regions: Shanghai, Hainan, Changsha, Xi'an, Qingdao and Dalian.<ref>{{Cite web|last=Tao|first=Li|date=2021-04-25|title=央行数研所牵手蚂蚁集团将推动建设数字人民币技术平台|trans-title=|url=https://finance.sina.com.cn/money/bank/bank_hydt/2021-04-25/doc-ikmxzfmk8853878.shtml|url-status=live|access-date=2021-05-02|website=finance.sina.com.cn|archive-url=https://web.archive.org/web/20210502052921/https://finance.sina.com.cn/money/bank/bank_hydt/2021-04-25/doc-ikmxzfmk8853878.shtml |archive-date=2021-05-02 }}</ref>

In June 2021, some Chinese cities expanded the use of e-CNY in public transportation. Chengdu was the first to fully integrate e-CNY payments across all buses and subway lines. This was part of a larger pilot to test the digital currency in daily transactions. Later, Beijing and Suzhou also implemented e-CNY for public transport, with Beijing enabling it on all 24 subway lines and Suzhou on its new Line 5.<ref>{{Cite web |date=2021-06-30 |title=Chinese cities roll out digital yuan to public transport networks |url=https://forkast.news/chinese-cities-roll-out-digital-yuan-to-public-transport-networks/ |access-date=2024-09-17 |website=forkast.news |language=en-US}}</ref>

At the end of 2021, there were 261 million users in the extended trial who had made US$13.8 billion of transactions <ref name="scmp-20220119">{{cite news |url=https://www.scmp.com/tech/tech-trends/article/3163953/chinas-digital-currency-e-cny-wallet-nearly-doubles-user-base-two |title=China's digital currency: e-CNY wallet nearly doubles user base in two months to 261 million ahead of Winter Olympics |last=Feng |first=Coco |newspaper=South China Morning Post |date=19 January 2022 |access-date=13 February 2022}}</ref> It has also been rolled out for foreign attendees at the 2022 Winter Olympics in Beijing, where it has seen limited use due to entrenched digital currencies and Visa, as well as a lack of publicity.<ref>{{Cite web|url=https://www.wsj.com/video/series/on-the-news/china-rolls-out-digital-yuan-for-foreigners-at-the-olympics/443BEAC3-8885-46C2-BC8D-83A031A1791F|title=China Rolls Out Digital Yuan for Foreigners at the Olympics|website=WSJ}}</ref>

==== 2022 ==== On March 31, 2022, People's Bank of China announced that the testing has been further expanded to six additional regions: Tianjin, Chongqing, Guangzhou, Fuzhou, Xiamen, and six cities in the province of Zhejiang that are hosting the 2022 Asian Games (Hangzhou, Ningbo, Wenzhou, Huzhou, Shaoxing, and Jinhua). Another news statement from PBOC shows that the cities of Beijing and Zhangjiakou are also being included on the list of testing after the 2022 Winter Olympics.<ref>{{cite web|url=https://news.sina.com.cn/c/2022-04-03/doc-imcwipii2181592.shtml|title=数字人民币试点迎来第三次扩围，催生哪些新的投资机会?|date=3 April 2022 }}</ref><ref>{{cite web|url=https://cn.reuters.com/article/china-cen-tianjin-digital-yuan-0402-idCNKCS2LU0CK|title=中国央行：新增天津、重庆、广州等地作为数字人民币试点地区}}</ref>

On December 16, 2022, the testing of Digital renminbi has been further expanded into five additional regions: Jinan, Fangchenggang, Nanning, Kunming, and Xishuangbanna.<ref>{{cite web|url=https://new.qq.com/rain/a/20221216A06OBB00|title=数字人民币试点范围再度扩容济南、南宁等5城新晋入选}}</ref>

==== 2023 ==== From May 2023, Changshu in the province of Jiangsu started to roll out salary payments in e-CNY for government employees as well as staff at state-owned companies and public institutions.<ref>{{Cite web |last=He |first=Laura |date=2023-04-24 |title=China makes major push in its ambitious digital yuan project {{!}} CNN Business |url=https://www.cnn.com/2023/04/24/economy/china-digital-yuan-government-salary-intl-hnk/index.html |access-date=2023-10-09 |website=CNN |language=en}}</ref>

On July 11, 2023, Bank of China, China Telecom, and China Unicom announced the joint launch of SIM card-based e-CNY wallets, which allow offline payments using the SIM's NFC function.<ref>{{Cite web |title=数字人民币SIM卡硬钱包上线，还支持无电支付 |url=https://news.cnstock.com/news,bwkx-202307-5089532.htm}}</ref>

In October 2023, digital yuan was first used in the cross-border crude oil settlement by PetroChina, the listed arm of China National Petroleum Corporation (CNPC).<ref>{{Cite web |last=Chhangani |first=Alisha |date=2023-11-06 |title=Central bank digital currency evolution in 2023: From investigation to preparation |url=https://www.atlanticcouncil.org/blogs/econographics/central-bank-digital-currency-evolution-in-2023-from-investigation-to-preparation/ |access-date=2024-03-13 |website=Atlantic Council |language=en-US}}</ref><ref>{{Cite web |date=2023-11-03 |title=Digital yuan used to settle crude oil trade - Central Banking |url=https://www.centralbanking.com/fintech/cbdc/7960119/digital-yuan-used-to-settle-crude-oil-trade |access-date=2024-03-13 |website=www.centralbanking.com |language=en}}</ref>

==== 2026 ====

The People’s Bank of China (PBOC) has unveiled The Action Plan for Further Strengthening the Digital Yuan Management Service System and Related Financial Infrastructure Construction (the “Action Plan”) (《关于进一步加强数字人民币管理服务体系和相关金融基础设施建设的行动方案》), which took effect on 1 January 2026. The Action Plan lays down a new generation of digital yuan measurement framework, management system, operational mechanism and ecosystem.<ref>{{Cite web |date=2026-01-08 |title=China unveils new framework for digital yuan (e-CNY) operations and ecosystem |url=https://www.jsm.com/publications/2026/china-unveils-new-framework-for-digital-yuan-e-cny-operations-and-ecosystem/ |access-date=2026-01-08 |website=www.jsm.com |language=en}}</ref>

==e-CNY wallet specifications==

An e-CNY wallet, which serves as a tool to store digital renminbi and make transactions, possesses four distinct specifications as revealed by the central Bank of China.<ref>{{Cite web |title=央行穆长春：数字人民币钱包按照客户身份识别强度分为不同等级_中证网 |url=https://www.cs.com.cn/xwzx/hg/202106/t20210611_6175187.html |access-date=2023-08-24 |website=www.cs.com.cn}}</ref>

;Wallet limits :The wallet with the highest level of anonymity needs only a mobile number for activation. It has a 2,000 yuan single payment limit, a daily cumulative limit of 5,000 yuan, and a 10,000 yuan balance cap.

:A wallet verified with an ID card and linked to a bank account has a 50,000 yuan single payment limit, a daily cumulative limit of 100,000 yuan, and a balance cap of 500,000 yuan.

;Personal and corporate wallets :Individuals and individual business owners can open personal wallets, with transaction and balance limits determined by the levels of their identity verification. Legal entities and non-legal entities can open corporate wallets, with transaction and balance limits contingent on whether the account is opened in person or remotely.

;Soft and hard wallets: :Soft wallets encompass mobile payment apps and services provided through software development kits (SDKs). Hard wallets include IC cards, wearable devices, and Internet of Things (IoT) devices.

;Master and sub-wallets: :Wallet holders have the option to designate an e-CNY wallet as the master wallet and create multiple sub-wallets within it. Master wallet holders are allowed to implement payment limits and conditions for the sub-wallets, and protect their privacy.

== Goals == [[File:ATM with E-CNY service of ICBC, Zhaojia Lane, SIP.jpg|thumb|upright|An ATM supporting digital RMB]] The PBOC has stated that the goal of launching digital RMB is to partially replace cash, but not bank deposits or privately run payment platforms.<ref name=":2" /> The bank claimed that digital RMB could be used to reduce money laundering, gambling, corruption and terror financing, and may improve the efficiency of financial transactions.<ref name=":2" /> The central bank also stated that it would limit how it tracks individuals, through the so-called "controllable anonymity."<ref name=":0" /> Critics say that the currency will give the Chinese government a new tool to monitor its people and financial transactions.<ref name=":0" /> In 2020, non-cash transactions represented 4 out of 5 payment transactions totaling a sum of 320 trillion yuan.

Li Bo, deputy governor of the PBOC, stated that the "goal is not to replace the U.S. dollar or other international currencies".<ref>{{Cite web|title=China says it has no plans to replace dollar with digital yuan|url=https://www.aljazeera.com/economy/2021/4/19/bb-china-says-it-has-no-plans-to-replace-dollar-with-digital-yuan|access-date=2021-04-28 |date=19 April 2021 |website=Al Jazeera |language=en}}</ref>

== Effects== === On digital payment platforms === According to World Bank data, in 2017, almost 20% of Chinese people over 15 did not hold a bank account.<ref>{{Cite web|title=Financial Inclusion Data|url=https://datatopics.worldbank.org/financialinclusion/country/china|access-date=2021-04-28|website=datatopics.worldbank.org}}</ref> As of February 2021, 87% of the population have access to fintech apps such as WeChat Pay and Alipay,<ref>{{Cite web|title=China's Digital Currency: Mao Would be Proud|url=https://www.martenscentre.eu/blog/chinas-digital-currency-mao-would-be-proud/|access-date=2021-04-28|website=Martens Centre |date=14 January 2021 |language=en-US}}</ref> which together account for more than 90% of electronic payments in China as of 2021.<ref name=":5" />

Chinese fintech apps have largely leapfrogged traditional card-based payment networks in China, due to the fintech apps' ease of use and much cheaper fees for merchants.<ref name=":7">Klein, Aaron. "China's digital payments revolution." ''Washington, DC: The Brookings Institution, April'' (2020).</ref> Transfers within WeChat Pay and Alipay are free within their respective ecosystems, and generally have a 0.1% fee for transfers outside their ecosystem, much lower than the 2–4% fee imposed by credit cards.<ref name=":7" /> WeChat Pay and Alipay each have over a billion users in China,<ref>{{Cite web|url=http://www.xinhuanet.com/english/2019-10/01/c_138440413.htm|archive-url=https://web.archive.org/web/20191003222221/http://www.xinhuanet.com/english/2019-10/01/c_138440413.htm|url-status=dead|archive-date=October 3, 2019|title=Alipay reports 1.2 bln users - Xinhua | English.news.cn|website=www.xinhuanet.com |date=2019-10-01}}</ref><ref>{{Cite web|url=https://www.wsj.com/articles/chinas-mobile-payment-boom-changes-how-people-shop-borrow-evenpanhandle-1515000570|first=Alyssa |last=Abkowitz |title=The Cashless Society Has Arrived – Only It's in China |work=The Wall Street Journal |date=January 4, 2018}}</ref> and are used by over 90% of the population in China's largest cities as their preferred payment method.<ref name=":7" /> The digital yuan might sideline these private digital payment platforms.<ref name=":5" />

=== Internationally === The digital RMB could provide a cheaper and more practical alternative to international transactions that are outside the U.S.-led global financial system, especially for countries with strong ties to China.<ref name=":0" /><ref name=":1" /> It is feared by U.S. commentators and officials that the digital RMB would weaken the ability of the U.S. to monitor and control the global financial system, through "dollar weaponization," such as sanctions<ref name=":0" /><ref name=":6">{{Cite news|date=2021-04-11|title=Biden Team Eyes Potential Threat From China's Digital Yuan|language=en|work=Bloomberg.com|url=https://www.bloomberg.com/news/articles/2021-04-11/biden-team-eyes-potential-threat-from-china-s-digital-yuan-plans|access-date=2021-04-19|quote=Powell said in February the Fed was looking "very carefully" at a digital dollar.}}</ref> and through its intelligence access to the SWIFT payment system.<ref>{{Cite web|date=2015-10-08|title=China launch of renminbi payments system reflects Swift spying concerns|url=https://www.ft.com/content/84241292-66a1-11e5-a155-02b6f8af6a62|url-status=live|website=Financial Times|archive-url=https://web.archive.org/web/20170325064127/https://www.ft.com/content/84241292-66a1-11e5-a155-02b6f8af6a62 |archive-date=2017-03-25 }}</ref>

=== Reactions === Some commentators have said that the U.S., which has only started to consider issuing a government-backed digital currency, risks falling behind China and weakening its dominance in the global financial system.<ref>{{Cite web|date=2021-03-17|title=Is the US worried it is falling behind China's digital currency?|url=https://www.scmp.com/economy/china-economy/article/3125658/china-digital-currency-us-worried-it-falls-behind-curve-race|access-date=2021-04-09|website=South China Morning Post|language=en}}</ref><ref name=":6" /> The digital renminbi has been described as a "national-security issue" threatening the US dollar by Josh Lipsky at the Atlantic Council think tank.<ref name=":0" /> It is also seen by commentators as a tool to allow Chinese authorities to keep domestic control and surveillance capabilities.<ref name=":0" /><ref>{{Cite news|url=https://www.reuters.com/article/us-china-markets-digital-currency-idUSKBN1XB3QP|title=China's proposed digital currency more about policing than progress|date=2019-11-01|work=Reuters|access-date=2019-11-10|language=en}}</ref>

Some argue that the real barriers to internationalisation of the renminbi are China's capital controls, which it has no plans to remove. Maximilian Kärnfelt, an expert at the Mercator Institute for China Studies, said that a digital renminbi "would not banish many of the problems holding the renminbi back from more use globally". He went on to say, "Much of China's financial market is still not open to foreigners and property rights remain fragile."<ref name="ft.c_Virtual_control">{{Cite web |title=Virtual control: the agenda behind China's new digital currency |last1=Kynge |first1=James |last2=Yu |first2=Sun |newspaper=Financial Times |date=February 16, 2021 |access-date=February 20, 2021 |url= https://www.ft.com/content/7511809e-827e-4526-81ad-ae83f405f623}}</ref> Victor Shih, a China expert and professor at the University of California, San Diego, said that merely introducing a digital currency "doesn't solve the problem that some people holding renminbi offshore will want to sell that renminbi and exchange it for the dollar", as the dollar is considered to be a safer asset.<ref name="qz.c_Why_China's">{{Cite web |title=The same problems plaguing the yuan will plague China's digital currency |last=Hui |first=Mary |publisher=Quartz |date=September 10, 2020 |access-date=April 11, 2021 |url= https://qz.com/1899402/why-chinas-digital-yuan-wont-internationalize-the-renminbi/}}</ref> Eswar Prasad, an economics professor at Cornell University, said that the digital renminbi "will hardly put a dent in the dollar's status as the dominant global reserve currency" due to the United States' "economic dominance, deep and liquid capital markets, and still-robust institutional framework".<ref name="qz.c_Why_China's"/><ref name="proj_China's_Digital">{{Cite web |title=China's Digital Currency Will Rise but Not Rule |last=Prasad |first=Eswar |publisher=Project Syndicate |date=August 25, 2020 |access-date=April 11, 2021 |url= https://www.project-syndicate.org/commentary/china-digital-currency-will-not-threaten-dollar-by-eswar-prasad-2020-08}}</ref> As of 2020, the U.S. dollar's share as a reserve currency was above 60%, while that of the renminbi was about 2%.<ref name="qz.c_Why_China's"/>

U.S. Treasury Secretary Janet Yellen and Federal Reserve Chairman Jerome Powell have said that they are studying the effects of digital currencies like the digital RMB and how they will affect the U.S. dollar.<ref name=":0" />

The EU is also considering issuing a digital euro.<ref>{{Cite web|date=2021-04-13|title=Digital euro|url=https://www.ecb.europa.eu/paym/digital_euro/html/index.en.html|access-date=2021-04-28|website=European Central Bank|language=en}}</ref> According to Clingendael Institute, digital currencies such as the digital yuan threaten the growing position of the euro as an alternative to the dollar.<ref>{{Cite web|title=Monetary sovereignty: why the EU needs a digital euro |url=https://spectator.clingendael.org/en/publication/monetary-sovereignty-why-eu-needs-digital-euro|access-date=2021-04-28|website=Clingendael Spectator |first1=Sanne |last1=van der Lugt |first2=Gys |last2=Hough |language=en |date=17 March 2021}}</ref>

== References == {{Reflist|2}}

{{Chinese currency and coinage}} {{Central_bank_digital_currency}} {{Economy of China}} {{Portal bar|Asia|China|Economy|Money|Numismatics}} {{Authority control}}

RMB Category:Renminbi