According to the local publication SCMP report, Zhou Xiaochuan, the former governor of China’s central bank, the People’s Bank of China, said in a conference on Sunday that the upcoming digital yuan is not being issued to replace existing fiat currencies. According to the former governor, the digital yuan will function alongside the currently used digital payment systems offered by nations and private operators. The central bank is all set to issue the DCEP to the general public.
Over $300 million in digital yuan tests were transacted as of last month.
The digital yuan tests have been widely successful so far. Over $300 million were transacted last month, and a test last week—a “tap” payments feature that mimicked cash payments—saw a record $3 million in transactions over the weekend. The former PBoC noted that “Some countries are worried about the internationalization of yuan. We can’t push them on sensitive issues, and we can’t impose our will. We must avoid the perception of great-power chauvinism,” he added.
The former PBoC head claimed that the change in focus came after Chinese authorities observed the global backlash to Facebook’s ambitious stablecoin project, initially called Libra.
“We don’t have the ambition to replace existing currencies.”
Zhou Xiaochuan, the former PBoC governor, said, “We are not like Libra, and we don’t have the ambition to replace existing currencies.” He added that while the digital yuan may see a use case for investments or trading, it isn’t meant to replace or challenge the US Dollar and the Euro. However, several economists and experts in the sector have claimed that the digital yuan could threaten the global dominance of the US dollar and its power as the world’s reserve currency.