Central Bank Digital Currencies (CBDCs) are rapidly gaining prominence in discussions around the future of money. The many dimensions of debate, whether policy, economic or financial, whittle down ultimately to design choices. With CBDC experiments in various stages of development globally, the norms of design are still being explored. It is in this environment that the ChineseDigital yuan is readying for launch.
China’s digital yuan, or DC/EP, is not just important from the perspective of geopolitics and its implications for the current underpinnings of the global financial system. What is arguably as significant is the technical design of this system – the first production-scale retail CBDC system in the world. As a result, the design choices of the DC/EP system are of high interest for the many central banks working on CBDCs. And as we discuss here, these design choices are also significant for the blockchain industry as a whole.
Tanvi Ratna is the