February 16, 2022
By Sharan Kaur Phillora
China has debuted an international trial for its central bank digital currency (CBDC) at the 2022 Beijing Winter Olympics amid concerns from US Senator Pat Toomey (R-Pa.) over the potential for the digital yuan to circumvent US sanctions.
Here’s what we know so far:
- Digital yuan trials, which have been ongoing domestically since 2019, were introduced to athletes and foreign visitors on Thursday as a means to pay for goods inside the Olympic Village alongside Visa payments and cash, according to Bloomberg.
- Inside the “Olympic bubble” – a dynamic quarantine zone China operates throughout the Olympic Village in Beijing – athletes, media, staff, and all other guests have three payment options available, rather than the usual two. Visa, cash, or China’s digital currency, the e-CNY.
- In Beijing’s Olympic bubble, China’s e-CNY payments system operates the same way as a prepayment card. Guests at the Olympic Village use cash to top up an e-CNY card, which they can then use for contactless payments at any point of sale in the Olympic Village.
- China began rolling out its digital currency in pilot zones in April 2020. According to officials, over 140 million users have registered for e-CNY accounts, which they can access through a smartphone app. As of November, the digital currency processed $9.7 billion worth of transactions.
- Although utilizing a card interface blurs the distinction between paying in e-CNY or paying with a Visa credit card, using China’s digital currency at the Olympics is cheaper than paying with Visa.
- Since 1986, Visa has served as the exclusive payment service provider for the Olympic Games, complimenting cash as one of the only two ways to pay for anything at official Olympic venues.
- According to the Wall Street Journal, e-CNY payments outnumbered Visa payments inside Beijing’s main Bird’s Nest stadium during the opening ceremony of the Beijing 2022 Winter Olympics last Friday. But Beijing hasn’t released any data on the uptake of e-CNY inside the Olympic bubble yet.
About the author
Sharan Kaur Phillora’s thirst for knowledge has led her to study many different subjects, including NFTs and Blockchain technology – two emerging technologies that will change how we interact with each other in the future. When she isn’t exploring a new idea or concept, she enjoys reading literary masterpieces.