{"id":10807,"date":"2023-04-15T04:32:06","date_gmt":"2023-04-15T04:32:06","guid":{"rendered":"https:\/\/www.bitnovo.com\/blog\/?p=10807"},"modified":"2022-05-18T11:41:14","modified_gmt":"2022-05-18T11:41:14","slug":"what-is-the-digital-yuan","status":"publish","type":"post","link":"https:\/\/www.bitnovo.com\/blog\/en\/what-is-the-digital-yuan","title":{"rendered":"What is the Digital Yuan?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-transparent ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Alternar tabla de contenidos\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #ffffff;color:#ffffff\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #ffffff;color:#ffffff\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.bitnovo.com\/blog\/en\/what-is-the-digital-yuan\/#why_was_the_digital_yuan_created\" >Why was the Digital Yuan created?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.bitnovo.com\/blog\/en\/what-is-the-digital-yuan\/#how_does_the_digital_yuan_work\" >How does the Digital Yuan work?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.bitnovo.com\/blog\/en\/what-is-the-digital-yuan\/#why_is_it_a_threat_to_the_dollar\" >Why is it a threat to the dollar?<\/a><\/li><\/ul><\/nav><\/div>\n<span class=\"span-reading-time rt-reading-time\" style=\"display: block;\"><span class=\"rt-label rt-prefix\">Tiempo de lectura:<\/span> <span class=\"rt-time\"> 3<\/span> <span class=\"rt-label rt-postfix\">minutos<\/span><\/span><p>In recent years, digital currencies have grown on a large scale and as always, China is not far behind. In this article we will talk about its\u00a0<strong>official digital currency<\/strong>, the Digital Yuan.<\/p>\n<p>The E-Yuan has been under development since\u00a0<strong>2014<\/strong>. Following its development, China began limiting the use of cryptocurrencies in the country, including Bitcoin. This caused cryptocurrencies to stop being used on more than 100 Chinese exchanges since 2017. All this backed by local regulations on fraud and money laundering.<\/p>\n<p>The arrival of the Digital Yuan meant a\u00a0<strong>technological breakthrough<\/strong>\u00a0for its users, as it would guarantee fast and convenient payments through\u00a0<strong>QR codes<\/strong>. However, the government would also benefit because they can monitor users and<strong>\u00a0collect their data.<\/strong><\/p>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"why_was_the_digital_yuan_created\"><\/span><strong>Why was the Digital Yuan created?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Throughout history, there have always been two countries fighting for the<strong>\u00a0world economy, China and the United States<\/strong>. Virtual currencies started to take a big share in the world\u00a0<strong>economy<\/strong>\u00a0and because of that came the Digital Yuan.<\/p>\n<p>One of the objectives of the Digital Yuan is to\u00a0<strong>defeat the dollar<\/strong>\u00a0in the struggle for the\u00a0<strong>economy<\/strong>. This decision to develop the E-Yuan directly affects the United States, as it threatens its hegemony as a world power. However, the existence of this digital currency also affects the cryptocurrency market.<\/p>\n<div class=\"is-divider divider clearfix\"><\/div>\n<div id=\"image_473886795\" class=\"img has-hover x md-x lg-x y md-y lg-y\">\n<div class=\"img-inner dark\"><img fetchpriority=\"high\" decoding=\"async\" class=\"attachment-large size-large ls-is-cached lazyloaded smush-detected-img smush-image-2\" src=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/05\/Qu%C3%A9-es-el-Yuan-Digital1.jpg\" sizes=\"(max-width: 768px) 100vw, 768px\" srcset=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/05\/Qu\u00e9-es-el-Yuan-Digital1.jpg 768w, https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/05\/Qu\u00e9-es-el-Yuan-Digital1-300x205.jpg 300w\" alt=\"Qu\u00e9-es-el-Yuan-Digital\" width=\"768\" height=\"526\" data-srcset=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/05\/Qu\u00e9-es-el-Yuan-Digital1.jpg 768w, https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/05\/Qu\u00e9-es-el-Yuan-Digital1-300x205.jpg 300w\" data-src=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/05\/Qu\u00e9-es-el-Yuan-Digital1.jpg\" data-sizes=\"(max-width: 768px) 100vw, 768px\" \/><\/div>\n<\/div>\n<h2><span class=\"ez-toc-section\" id=\"how_does_the_digital_yuan_work\"><\/span><strong>How does the Digital Yuan work?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>This currency was officially launched by the<strong>\u00a0Central Bank of China<\/strong>. This ensures that the<strong>\u00a0backing<\/strong>\u00a0is China\u2019s own money. In this way, its price stability is guaranteed, unlike most cryptocurrencies. The main objective of the\u00a0<strong>E-Yuan<\/strong>\u00a0is based on<strong>\u00a0replacing<\/strong>\u00a0part of the banknotes and coins in\u00a0<strong>circulation<\/strong>. The Central Bank is in charge of\u00a0<strong>issuing<\/strong>\u00a0the new coins in circulation, therefore, it is responsible for the issuance of the currency. This currency has its\u00a0<strong>equivalent<\/strong>\u00a0in the real world, this thanks to its backing in\u00a0<strong>physical money.<\/strong>\u00a0In addition, it is\u00a0<strong>regulated<\/strong>\u00a0by the Asian giant.<\/p>\n<p>It should be noted that the E-Yuan is a\u00a0<a href=\"https:\/\/www.bitnovo.com\/blog\/en\/what-is-a-cbdc-or-central-bank-digital-currency\/\">CBDC or Central Bank Digital Currency<\/a>, so it does not have the\u00a0<strong>anonymity<\/strong>\u00a0offered by cryptocurrencies,<strong>\u00a0it is not decentralized<\/strong>\u00a0and it also\u00a0<strong>stores the personal data<\/strong>\u00a0of its users\u2019 transactions.\u00a0 Due to these notable differences with respect to cryptocurrencies, many users claim that the E-Yuan is a tool that allows the government to\u00a0<strong>monitor its economy<\/strong>\u00a0and the transactions made by the population.<\/p>\n<p>According to the government, the Digital Yuan is merely a tool under\u00a0<strong>development aimed at balancing the economy<\/strong>, improving it and making it smarter by collecting and applying real-time\u00a0<strong>data<\/strong>.<\/p>\n<p>This digital experiment appears to be not only intended for a\u00a0<strong>internal economy<\/strong>, but is designed to\u00a0<strong>expand<\/strong>\u00a0worldwide as a method of payment. The Central Bank is in the process of developing to enable the Digital Yuan for\u00a0<strong>cross-border<\/strong>\u00a0payments.<\/p>\n<p>It is known that China\u2019s Ministry of Commerce\u00a0<strong>estimates<\/strong>\u00a0a trial period for the currency that could last until\u00a0<strong>2023<\/strong>, although the international press currently claims that the E-Yuan will be available to participants in the<strong>\u00a02022<\/strong>\u00a0Winter Olympic Games to be held in\u00a0<strong>Beijing<\/strong>, with the aim of extending it to the whole world.<\/p>\n<p>With the enabling of the already developed Digital Yuan, commercial banks are\u00a0<strong>required<\/strong>\u00a0to convert part of their assets into this new digital currency and\u00a0<strong>distribute<\/strong>\u00a0them to the country\u2019s enterprises and citizens.<\/p>\n<p>According to local statements four of the country\u2019s largest banks have started\u00a0<strong>internal tests of a digital wallet<\/strong>. These state-owned banks are Industrial and Commercial Bank of China (ICBC), China Construction Bank (CCB), Agricultural Bank of China and Bank of China.<\/p>\n<div class=\"is-divider divider clearfix\"><\/div>\n<div id=\"image_264656950\" class=\"img has-hover x md-x lg-x y md-y lg-y\">\n<div class=\"img-inner dark\"><img decoding=\"async\" class=\"attachment-large size-large ls-is-cached lazyloaded smush-detected-img smush-image-3\" src=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/05\/Qu%C3%A9-es-el-Yuan-Digital2.jpg\" sizes=\"(max-width: 768px) 100vw, 768px\" srcset=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/05\/Qu\u00e9-es-el-Yuan-Digital2.jpg 768w, https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/05\/Qu\u00e9-es-el-Yuan-Digital2-300x205.jpg 300w\" alt=\"Qu\u00e9-es-el-Yuan-Digital\" width=\"768\" height=\"526\" data-srcset=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/05\/Qu\u00e9-es-el-Yuan-Digital2.jpg 768w, https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/05\/Qu\u00e9-es-el-Yuan-Digital2-300x205.jpg 300w\" data-src=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/05\/Qu\u00e9-es-el-Yuan-Digital2.jpg\" data-sizes=\"(max-width: 768px) 100vw, 768px\" \/><\/div>\n<\/div>\n<div class=\"is-divider divider clearfix\"><\/div>\n<p>To summarize, among the characteristics for which the Digital Yuan stands out is that although it is a\u00a0<strong>digital currency, it is centralized<\/strong>\u00a0and anchored to the value of the\u00a0<strong>Yuan<\/strong>. However, it helps the Chinese economy to participate in the global economy by<strong>\u00a0boosting it<\/strong>.<\/p>\n<p>Another important aspect, especially for traders, is that the E-Yuan does not depend on market\u00a0<strong>speculation<\/strong>, as it is managed solely by the\u00a0<strong>Central Bank of China.<\/strong><\/p>\n<p>Finally, the Digital Yuan\u00a0<strong>does not use\u00a0<a href=\"https:\/\/www.bitnovo.com\/blog\/en\/what-is-blockchain-and-how-does-it-work\/\">blockchain<\/a><\/strong>, instead it has a\u00a0<strong>basic encryption<\/strong>\u00a0that guarantees the\u00a0<strong>security and transparency<\/strong>\u00a0of transactions. It should be noted that this currency can be used\u00a0<strong>without an internet connection<\/strong>.<\/p>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"why_is_it_a_threat_to_the_dollar\"><\/span><strong>Why is it a threat to the dollar?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Beijing\u2019s main goal for this digital currency is to\u00a0<strong>position<\/strong>\u00a0it for\u00a0<strong>international use and payments<\/strong>. This area has belonged to the\u00a0<strong>US dollar<\/strong>\u00a0for decades.<\/p>\n<p>According to some news reports,\u00a0<strong>the U.S<\/strong>. administration is constantly monitoring the currency\u2019s development due to\u00a0<strong>concerns<\/strong>\u00a0that the E-Yuan could become an interesting offer for some\u00a0<strong>countries<\/strong>\u00a0that would abandon the dollar as a\u00a0<strong>reserve currency of value.<\/strong><\/p>\n<p>The\u00a0<strong>distribution<\/strong>\u00a0of the currency and its possible\u00a0<strong>uses<\/strong>\u00a0in terms of avoiding U.S.\u00a0<strong>sanctions<\/strong>\u00a0are currently being studied. However, the country has tried to\u00a0<strong>deny<\/strong>\u00a0these claims on several occasions. China stated that for the time being the E-Yuan is only for\u00a0<strong>domestic<\/strong>\u00a0use, but it is not ruled out that in the future it will be used for\u00a0<strong>cross-border<\/strong>\u00a0payments.<\/p>\n","protected":false},"excerpt":{"rendered":"<p><span class=\"span-reading-time rt-reading-time\" style=\"display: block;\"><span class=\"rt-label rt-prefix\">Tiempo de lectura:<\/span> <span class=\"rt-time\"> 3<\/span> <span class=\"rt-label rt-postfix\">minutos<\/span><\/span>In recent years, digital currencies have grown on a large scale and as always, China is not far behind. In this article we will talk about its\u00a0official digital currency, the Digital Yuan. The E-Yuan has been under development since\u00a02014. Following its development, China began limiting the use of cryptocurrencies in the country, including Bitcoin. This [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":7172,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[185],"tags":[],"class_list":["post-10807","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blockchain-en"],"_links":{"self":[{"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/posts\/10807","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/comments?post=10807"}],"version-history":[{"count":0,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/posts\/10807\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/media\/7172"}],"wp:attachment":[{"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/media?parent=10807"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/categories?post=10807"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/tags?post=10807"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}