Digital Yuan Shaping Global Monetary Revolution
China’s digital payment platform chips away at US dollar’s global dominance
By: Toh Han Shih
China’s international digital currency platform, Project mBridge, is quietly setting out to attempt to shape a revolution in the world’s financial payment system by seeking to erode the global dominance of the US dollar, analysts say, building an international payment infrastructure which is shifting the global pattern of payments towards the yuan.
Project mBridge is based on blockchain, a distributed ledger technology with decentralized ledgers spread across an online network. It began in 2021 as a collaboration between the Bank of International Settlements (BIS) Innovation Hub, the Bank of Thailand, the Central Bank of the United Arab Emirates (UAE), the Digital Currency Institute of the People’s Bank of China (PBOC) and the Hong Kong Monetary Authority (HKMA).
Participating financial institutions include the World Bank, the International Monetary Fund (IMF), the Federal Reserve Bank of New York, the Reserve Bank of Australia, Bank of Korea and Central Bank of Malaysia.
“Project mBridge, China’s cross-border central bank digital currency platform, processed US$56 billion in transactions by late 2025 - up 2,500-fold from its 2022 pilot,” said Diana Choyleva, chief economist of Enodo Economics, a UK political and economic consultancy, on a March 4 LinkedIn post. “Transfers that once took days now happen in seconds. Firms that once needed dollars for settlement now have a cheaper, faster alternative.”…
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