China’s digital yuan initiative has advanced considerably, backed by over a decade of research and four years of pilot experimentation, according to Lu Lei, Deputy Governor of the People’s Bank of China (PBOC). Trials for the Chinese central bank digital currency (CBDC) have been conducted in 17 different areas, accumulating a total transaction value of 7 trillion yuan (close to $1 trillion). In addition, China is working with several nations on a cross-border digital currency project, aiming to enhance global payment systems.

China’s Digital Yuan Milestones and International Cooperation

The State Council Information Office of China held a series of press conferences last week focused on “Promoting High-quality Development.” Lu Lei, Deputy Governor of China’s central bank, the People’s Bank of China (PBOC), participated, addressing questions regarding the digital yuan’s progress.

“At present, the digital RMB has been piloted in 17 provinces (autonomous regions and municipalities), and has continued to explore in the fields of wholesale and retail, catering, culture and tourism, education and medical care, forming a number of online and offline, replicable and popularizable application solutions,” the official detailed, as translated by Google. He further shared:

As of the end of June this year, the cumulative transaction amount of the digital RMB reached 7 trillion yuan [nearly $1 trillion].

Lu emphasized the digital RMB’s role in improving financial inclusivity and payment efficiency, stating: “The digital RMB has played a positive role in boosting residents’ consumption, promoting green transformation, and optimizing the business environment.”

The deputy governor highlighted that 10 years of research have led to the digital RMB’s preliminary success, verified through extensive pilot projects. According to him, China has developed a “two-tier operating structure” for the digital RMB, combining central bank oversight with operational institutions.

He emphasized:

After more than 6 years of research and development and more than 4 years of pilot projects, the feasibility and reliability of the digital RMB in theory, business and technology have been preliminarily verified, and we are also trying to make it more compatible with the digital economy. Overall, the progress is smooth.

Additionally, the Chinese central bank is actively participating in a cross-border digital currency project involving central banks from Hong Kong, Thailand, and the UAE. The project, led by the Bank for International Settlements, aims to address cross-border payment inefficiencies and is currently at the minimum viable product stage.

“The People’s Bank of China is willing to actively participate in and jointly study the improvement of cross-border payment arrangements,” Lu noted. The project has already allowed real transactions across participant jurisdictions, highlighting the potential for future international cooperation.