With the inauguration of the Shanghai Operations Centre, China has taken a new step in its strategy to expand its use of digital currency.
The centre will be managing the Bank of China’s Digital Currency Institute, responsible for designing and maintaining the cross-border infrastructure of E-CNY.
In this way, the entity is dedicated to ensuring not only connections between the project and the national and international financial systems, but also to foster the development of the financial markets associated with it.
Within this opening framework, Popular Chinese banks highlighted three key initiatives to boost CBDC internationalization (Central Bank Digital).
The first is a digital cross-border payment platform designed to investigate the use of E-CNY and increase the efficiency of international transactions.
The second is a service platform that allows payments directly in a chain and standardizes the transfer of information between different spaces.
Finally, the third one is Digital asset systems to help expand existing financial infrastructurestandardized and ready-to-use – provides cryptocurrency services.
“Developing and paying financial systems in the digital age is an inevitable historic trend,” said Luray, lieutenant governor of Popular Bank Banks (PBOCs) at a press conference.
E-CNY International Operating Center It functions as an engine that integrates Shanghai as a global financial space. According to city Vicealcalde executive Wu Wei, Shanghai will use the platform and services at the location to continuously expand the case of Yuan Digital’s use and strengthen the level of adoption and internationalization.
It should be noted that China was one of the first economies to introduce digital currency issued by central banks, and pilots were launched in several selected cities in 2019.
Until now, E-CNY is primarily used for daily paymentspublic transport, wages, retail purchases, government relocation, etc.
However, it was announced last April that the Asian giant launched a cross-coverer liquidation system based on the CBDC, linking 16 countries, including Medium-term ASEAN and Orienta.
The initiative included countries such as Brunei, Cambodia, the Philippines, Indonesia, Laos, Malaysia, Myanmar, Singapore and Thailand.
The measure was implemented in commercial tensions with the US.countries that impose tariffs on many of these territories and were reported by encryption.
This was primarily due to commercial and technical tensions with the US, with Beijing fostering international adoption of the original digital and strengthening its efforts to integrate Shanghai as a global financial centre.
“The opening of the Shanghai centre not only promotes international payments, but also strengthens the city’s role as a global financial centre,” Lu said.
The opening of the centre is worth clarifying what was already anticipated in June when China’s popular bank governor, Pan Gongshen, said that digital technology had uncovered the limitations of traditional international payment systems, where it is vulnerable to political influence and unilateral sanctions.
Officials said Beijing is seeking a multi-polar financial system. He said that several currencies could coexist with prominence and increase the resilience of international trade to shocks and geopolitical pressures.
Loss of digital money and financial autonomy
With regard to CBDCs, it is important to note that the issuing government maintains full control of the currency and has access to a record of all operations carried out by users.
This means that each transaction from daily payments to international remittances can be monitored and registered, raising questions about individual privacy and centralized financial oversight.
With total access, The government can freeze accounts from individuals or businesses, or block transactions No immediate judicial intervention is required. This is something that doesn’t happen in traditional cash-based currency systems.