China tests national digital currency in major cities

The shift to digital currency gives governments more control over their money. This is what China is looking for, where the Executive is testing eCNY, launched in 2020, in cities such as Shenzhen, Shanghai and Beijing.

As reported by the The New York Times, the currency will also allow China to leverage its influence abroad, with the country in one of the most advanced stages the world with regard to digital currency.

“It’s more than just money,” said Yaya Fanusie, a researcher at the Center for Economic and Financial Power. “It is about developing new tools to collect data and take advantage of it so that the Chinese economy is smarter and based on information in real time,” he said.

Yaya Fanusie indicated that China wants “a digital currency to take advantage of the market share and technological innovation of private companies, thus obtaining better access to information about the financial activities of Chinese consumers”.

The Chinese government has made no official statement on the national implementation of eCNY. Several authorities, however, have indicated that this may happen before the 2022 Olympic Games in Beijing.

The project for eCNY started in 2014, when, inspired by Bitcoin, the People’s Bank of China established an internal group to create its own digital currency.