This was dropped by the director of the Digital Currency Research Institute, Changchun Mu, at the China International Fair for Trade in Services (CIFTIS) 2023.

It appears that merchants will need to implement QR codes for transactions using the CBDC to facilitate adoption. In parallel, the central bank has plans for long-term updates to payment tools, although Mu did not give further details about these updates. The senior official did not delve into the technical details of the integration of the digital yuan, but said that efforts will be made to integrate it into the existing infrastructure.

China CBDC

At the “digital yuan avenue 3.0” in Shougang Park, one of the venues of the CIFTIS 2023 Fair, attendees were able to experiment with some future applications of the digital yuan. The financial institutions present at the event showcased the latest products related to the digital yuan. Such as the digital yuan hardware wallet, smart wristbands, a digital employee card, and the student smart card. Other applications of the digital yuan include the use of these advances in transportation, hospitality, government affairs, rural revitalization, green finance, cultural tourism and cross-border settlements, among others.

DBS Bank Launches China CBDC Collection Solution

Regarding these developments, a representative of food delivery company Meituan indicated that even in cases where there is no internet or electricity, using a mobile phone with a SIM card equipped with a digital yuan hardware wallet, you can still pay a deposit on a battery rental device and charge your phone.

Fears

The digital yuan pilot has been running in various provinces in China. In October 2020 he started private tests in Shenzen. In September 2022, the regions of Guandong, Hebei, Jiangsu and Sichuan were added, being implemented for use in selected stores and special points of sale arranged for this purpose.

Challenges of China's digital yuan to be the currency of the BRICS

International analysts fear that China will use this type of technology as a surveillance mechanism and that it will serve to impose financial restrictions on citizens who do not comply with the guidelines established by the government. However, China's CBDC has served as a shock to the rest of the world's countries. Currently, there are few central banks that are not immersed in the development of a CBDC. However, it is the digital yuan that is in a more complete phase of development.