China Is Trying to Erase Concerns That Digital Yuan Will Dethrone The Dollar

China, trying to develop its own digital currency, is trying to dispel the concerns that the digital yuan will overtake the dollar as a global reserve currency.

China is trying to erase concerns that the digital yuan will dethrone the dollar. Preparing to develop its own digital currency, China faced concerns that it would dethrone the world's reserve currency, the US dollar. Speaking at a forum on Sunday, Deputy Governor of the Bank of China Li Bo pointed out that they are not aiming to dethrone the dollar with the digital yuan. Li stated that e-yuan is only intended to be used in the domestic market for now, while cross-border use may also be possible in the long term. The Bank of China is in the process of testing the "digital yuan" in various pilot applications across the country. The bank started testing digital money in 11 cities. It was stated last week that the Biden government in the USA will examine China's moves on the digital yuan. The Bank of China has been working on digital currency since 2014. With the expectation that the increasing use of cryptocurrency will change the functioning of the financial sector, other central banks and policymakers have also started to pay more attention to this area. Li Bo also stated that they aim to use the digital yuan in the 2022 Beijing Winter Olympics.