China’s Giant Bet on Blockchain

THERE IS NO STAGE BIGGER THAN THE OLYMPICS, for the athletes and the host country. Modern China announced its arrival 13 years ago when 2,008 synchronized drummers wowed the world at the Beijing Summer Olympics opening ceremonies. In February, China is expected to use the Beijing Winter Olympics to unveil a creation of intense international interest: the digital yuan, the first major central bank digital currency, or CBDC.

Consumers are unlikely to notice much difference shopping with e-CNY, as the currency is officially known. It will be worth the same as cash and will activate with a tap, swipe or QR code. But the questions this form of money raises are profound. As governments around the world move to phase out physical cash, what will become of financial privacy? How will state-sponsored digital money affect China’s economy, its trading relationships and—most weighty