While Russia’s invasion of Ukraine continues, there has been much speculation about China’s potential exit strategy if equivalent SWIFT sanctions are ever imposed on the world’s second-largest economy – its central bank digital currency. China’s top leaders are expected to address the issue at the Two Sessions, according to observers.
The Beijing Winter Olympics, which just ended, gave China the opportunity to show off their e-CNY to a global audience of athletes and politicians. Last month, Mu Changchun, director-general of the People’s Bank of China Digital Currency Initiative, stated the e-CNY was one of only two means of payment accepted at the Olympic venues, the other being the credit card of Olympic Games sponsor Visa.
“Unexpectedly, the e-CNY is receiving even greater attention as a result of the global interest in sanctions and SWIFT restrictions since they were placed on Russia,” Richard Turrin, a Shanghai-based fintech consultant, told Forkast. “The e-CNY, which has been in the news on a daily basis, has the power to partially protect China from these kind of financial limitations.”
Turrin believes the future government work paper will mention the e-accomplishment CNY’s at the Olympics and “have a carefully crafted statement that recognises the concept of establishing a currency that is immune to global meddling without mentioning the controversy,” according to Turrin.