China is one of the few countries where a CBDC is in circulation today. The People’s Bank of China now wants to expand this scheme to more cities over the coming months. It will still be part of a pilot scheme for the digital currency but remains interesting either way.
Broader CBDC Distribution in China
It remains a tad unclear how well the CBDC venture in China has evolved in recent months. Although the trial is ongoing across many cities and regions, there are no frequent updates whatsoever. That changed this week when the PBoC announced it would expand the pilot scheme to more areas in 2022. China’s CBDC will come to cities in the Zhejiang province, where the Asian Games will be hosted in a few months.
Per the PBOC, the expansion of the trial will promote the research and development of e-CNY. Additionally, it expands the scope of the pilot scheme, providing more feedback and details on improving the CBDC. Eleven cities will be added to the pilot, bringing the total to 21. That is still a small selection of regions for the E-CNY, but one has to start somewhere.
Being part of the Asian Games 2022 is a positive development for China’s CBDC. An earlier attempt to impact the Beijing Winter Olympics was thwarted by COVID-19, pushing back the project by a few years. However, the locals seemed rather enthusiastic about this digital currency, initially providing a small field to work in. The Asian Games will be a different challenge and provides more reliable feedback.