Since I warned February 6 that China’s “digital yuan could bust the United States,” a great deal of nonsense on the topic has filled the media, offset by some good sense from the economists at the US investment house Morgan Stanley.
An April 11 Bloomberg report declared, “The Biden administration is stepping up scrutiny of China’s plans for a digital yuan, with some officials concerned the move could kick off a long-term bid to topple the dollar as the world’s dominant reserve currency.”
The $16 trillion of offshore dollar deposits at international banks won’t turn into the equivalent number of Chinese yuan. Instead, as Morgan Stanley analysts explained this week, “banks will lose their deposit base” as digital currencies replace their most basic functions.
Every business in the whole variegated, complex supply chain will make a digital transfer from its central bank digital currency (CBDC) account.
The People’s Bank of China is collaborating with the world’s main agency for international payments, the Society for Worldwide Interbank Financial Telecommunication, to expedite financial transfers in digital yuan.
And because the digital yuan will be the largest currency in international trade, and China will have a market leader advantage in introducing CBDC’s, other exporters will use the digital yuan as a matter of convenience.
“Direct access to central banks will allow tech-enabled non-banks to offer payment services and digital wallets, capturing customer transaction data in the process.
- How AI Accelerates Digital Transformation’s Success
- Geek Speak: When digital transformation is not just about technology
- 4 ways to position digital and customer transformation in the boardroom
- Accelerating Digital Transformation Through the Hybrid Cloud
- Strategies to create user-centric digital services
- How to lead a digital transformation — ethically
- Blockchain-enabled Digital Health Credentials to Help Businesses Reopen Safely and Build the Future of Digital Ecosystems
- China’s digital yuan displaces the dollar
- Why AI can’t solve unknown problems
- Am I arguing with a machine? AI debaters highlight need for transparency