China is offering athletes and visitors the digital yuan during the ongoing winter Olympics games as part of the test phase amid concerns from the US.
Senator Pat Toomey has asked the US Treasury to examine the currency closely. The authorities are concerned that the eCNY could circumvent sanctions, facilitate money laundering, and China’s surveillance.
eCNY links transactions on apps to the user’s phone number with the capacity to make transfers through tapping phones. The digital yuan is a legal tender exchangeable via QR or bar codes with no intermediaries.
The deputy director of the Chinese Central bank’s Digital Currency Institute, Di Gang, thinks that the global market is rapidly digitizing, especially in the financial industry.
The US agencies have been exploring Fed-backed digital currency, though not much progress has been made. The Federal Reserve bank of Boston is working with MIT on the same.
China started venturing into CBDC in 2019, and the roll-out is significant to the country. The public use of the currency was announced at the start of 2020.