A recent survey of the Bank for International Sattlements (BIS) revealed how 86% of national banks are actively considering their own CBDC, 60% are experimenting with the technology and 14% are implementing pilot projects. In Asia, China, Hong Kong, Japan, South Korea, Singapore and Thailand are already at an advanced stage and have long since launched pilot projects to explore the retail use of CBDCs. Among the major countries in the world, China is the most advanced in development: with seven years of work, the Chinese e-CNY digital yuan, formerly known as the DCEP (Digital Currency, Electronic Payment) project, has already been tested by banks, shops and millions of people across China e it will likely be launched in 2022. Launched in several cities since late 2019, as of June 30 of this year, e-CNY has been applied in over 1.32 million scenarios, covering payments for utilities, food, transportation, purchases and government services.
As reported by China.org which takes the news from China Securities Journal China’s digital currency has entered the country’s real financial life being used for the first time by the Dalian Commodity Exchange (DCE) for the payment of storage costs to a delivery warehouse, assisted by the local branches of Bank of Communications e Bank of China. The application of e-CNY in the futures market has provided an efficient, cost-free and secure payment alternative for the financial markets through a real-time interbank payment. Jiang Bin, in charge of the delivery warehouse, said that e-CNY payment does not charge any transaction fees and it is not limited to the period of operation of the payment system so as to allow companies to keep an eye on the progress of transactions in real time.
Central bank interest in CBDCs comes at a critical time. Recent developments have placed a number of potential innovations that have brought digital currencies to the top of the agenda. The growing attention received by bitcoin and other cryptocurrencies and the growing debate on stablecoins have had an important but it was the entry of big tech companies into payment services and financial services more generally that pushed towards the acceleration of national digital currencies, primarily e-CNY. “The new trade wars are technology wars,” he explained Benoit Coeure of BIS: “The train has left the station”. The push comes at a time when the use of physical cash declines globally and authorities seek to fend off the threat to their printing powers of the money coming from bitcoin and Big Tech efforts such as Facebook which yesterday announced the development of its Novi crypto wallet connected to the Diem Blockchain system. David Marcus, head of financial services at Facebook and a member of the board of directors of Diem, explained: “The change is long overdue. It will happen one way or another. Novi is ready to reach the market. We believe it is unreasonable to delay the delivery of the benefits of cheaper, interoperable and accessible digital payments”.