The digital yuan expands its coverage. After the first pilot projects launched in a few cities and metropolitan areas, the digital yuan is coming to Hong Kong. The Chinese digital currency could be mainly used to overcome the current weaknesses of banks, in the area of cross-border payments.
The People’s Bank of China and theHong Kong Monetary Authority (HKMA) would be in the preliminary stages of a pilot project for cross-border payments using the digital yuan.
In a press release dated December 4, 2020 published on the website of HKMA, the executive manager, Eddie Yue, provided details on the project.
He indicated that the discussions between the 2 institutions for the technical preparations for the implementation of the e-CNY are in class.
Yue believes that the digital yuan could be of particular benefit to the tourism industry; the digital yuan has the same value as cash in circulation.
The transition to crypto-yuan is a matter of convenience since the yuan is already used at Hong Kong.
China now, soon Asia
The China ahead of them United States, theEurope, or the Korea and the Japan in the race for CBDCs; it launched several pilot projects dealing with transactions valued at $ 300 million in early November 2020.
The first projects had been deployed in 4 large cities then extended to 9 metropolitan areas.
The special administrative region of Hong Kong has been studying potential areas of use for CBDCs for about 3 years.
In 2019, the HKMA had launched a research project in partnership with the Bank of Thailand to address concerns about cross-border payments and digital currencies.
Eddie Yue announced that this project had entered its 2nd phase which concerns the operability and scalability of CBDCs for cross-border payments.
In the long term, the aim would be to design an integrated cross-border payments platform for the region.
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Can the digital yuan conquer all of Asia? Will he be able to cross the borders of the United States and Europe? The African continent, whose electronic payment solutions are lacking in most of its countries, will it adopt the Chinese digital currency en masse? The digital yuan is now tackling the problems of cross-border payments while its competitors are still studying on paper whether to launch their CBDCs. A single digital currency could ultimately rule the world: the digital yuan if Bitcoin (BTC) fails to stop its influence and expansion.
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