How a digital yuan impacts investor appetite

So long as capital controls remain, a digital currency alone will do little to internationalise the renminbi (RMB), but the pull of this market will be hard for investors to ignore.

While few investors know how virtual currencies will influence future consumption habits, many are aware that China is leading the charge. Running its digital yuan e-RMB programme as far back as 2014, China concluded its latest pilot project by handing out digital RMB 200 to Beijing residents over the Lunar New Year, extending earlier trials in Shenzhen and Suzhou.

Beijing’s political ambitions are clear. The e-RMB will allow the People’s Bank of China PBOC to directly oversee fund flows and monitor illicit activities such as tax evasion or money laundering. And unlike other cryptocurrencies, a digital yuan will be a sovereign asset backed by the central bank, capable of facilitating...

¬ Haymarket Media Limited. All rights reserved.

FinanceAsia has updated its subscription model.

Registered readers now have the opportunity to read 1 article from our award-winning website for free.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team subscription (2-5 users), or office-wide licences.

To help you and your colleagues access our proprietary content, please contact us at [email protected], or +(852) 2122 5222