China’s digital yuan (e-CNY), once a frontrunner in central bank digital currencies (CBDCs), faces challenges including corruption scandals and slow adoption due to entrenched online payment giants like Alipay and Wechat Pay. The downfall of Yao Qian, a leading architect of the e-CNY, over cryptocurrency-related bribery allegations, has intensified scrutiny of its rollout. While cumulative transactions reached 7 trillion yuan ($968 billion) by June, the yuan’s global usage remains modest at 2.93% of payments, trailing major currencies. Analysts argue that the digital yuan’s success hinges on integration into practical applications, such as fiscal subsidies and consumption incentives, supported by innovative tools like “hard wallets.” Despite setbacks, experts believe China’s push aligns with global CBDC trends aimed at reducing reliance on the US dollar in cross-border payments. However, limited international appeal of the yuan itself constrains its broader adoption and financial influence.

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