China’s Digital Yuan Nears $1 Trillion in Transactions, PBOC Official Confirms

China’s digital yuan initiative, launched by the People’s Bank of China (PBOC), has achieved significant milestones. After more than a decade of research and four years of pilot trials, the digital currency has processed nearly 7 trillion yuan in transactions, equivalent to around $1 trillion.

This information was revealed by Lu Lei, Deputy Governor of the PBOC, during a press conference organized by the Chinese State Council Information Office.

Key Takeaways:

• China’s digital yuan has processed $1 trillion in transactions across 17 regions after four years of trials.
• The currency has proven effective in promoting consumption, green transformation, and business environment optimization.
• China is collaborating with Thailand, UAE, and Hong Kong on a cross-border digital currency project led by the Bank for International Settlements (BIS).

Since the digital yuan’s pilot program began, trials have been conducted in 17 regions across China, spanning various industries such as retail, tourism, education, and healthcare. The digital yuan is being used for both online and offline transactions, and authorities are working on replicable application solutions that can be expanded across the country.

Lu Lei emphasized the positive impact of the digital yuan in boosting consumer spending, enhancing green transformation, and improving the business environment. Additionally, the central bank’s digital currency (CBDC) has contributed to financial inclusion by making payments more accessible and efficient.

The PBOC has developed a two-tier operational structure for the digital yuan, combining central bank oversight with private sector involvement to ensure efficient deployment. According to Lu, this model has proven both theoretically viable and reliable during the pilot phase, marking a major step toward the broader adoption of the digital currency.

International Collaboration on Cross-Border Payments

Beyond domestic usage, China is actively collaborating on international projects to improve cross-border payment systems using digital currencies. China’s central bank is working alongside Thailand, the UAE, and Hong Kong on a cross-border digital currency initiative. The project, which is led by the Bank for International Settlements (BIS), aims to address the inefficiencies that currently exist in cross-border payments.

At present, the project is in the minimal viable product stage, with real transactions already completed between participating countries. Lu Lei emphasized China’s commitment to engaging in global partnerships to further enhance cross-border payment systems.

This international cooperation not only demonstrates the increasing relevance of the digital yuan on the global stage but also aligns with China’s ambition to improve financial connectivity across borders.

The Road Ahead for the Digital Yuan

China’s digital yuan journey has not been without challenges, but the PBOC’s efforts have yielded substantial progress. Over the last decade, the central bank has worked tirelessly to ensure the digital currency’s technological compatibility with the digital economy, with successful pilot results indicating that it could be widely implemented in the future.

Lu Lei remains optimistic about the future of the digital yuan, stating that further research and development will focus on enhancing the currency’s functionality and increasing its interoperability with other global digital currencies. The aim is to continue refining the two-tier operational system while scaling up the digital yuan’s applications across sectors.

China’s ability to involve private sector players in the currency’s development, along with its successful pilot programs, has showcased the digital yuan as a game-changing tool for financial innovation. As the nation continues to improve its payment systems and expands into cross-border collaborations, the digital yuan’s role in both domestic and international financial ecosystems is set to grow.

As China continues to refine its digital yuan framework, the potential for the currency to influence both domestic and global markets is becoming increasingly clear.