The People's Bank of China confirmed that the digital yuan (or renminbi) can be used for cross-border transactions, in addition to functioning as a domestic retail payment.
The Digital Currency Research Institute of the People's Bank of China and the Hong Kong Monetary Authority are in the early stages of testing cross-border use of renminbi in mainland China and Hong Kong. The People's Bank of China stated that the next steps for the digital renminbi program are (i) to further promote the pilot, and (ii) to accumulate more experience on the use of renminbi.
While the Federal Reserve Board's cautious approach as to the digital dollar is understandable, it has been clear that this development was coming. The United States will now be - at best - second in line.
One can argue all one likes as to whether central bank digital currencies are a good thing. They are an inevitable thing, so whether it is good or bad is a somewhat moot policy question. Given that it is inevitable, it would be better to be early to the game.
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