Emerging Digital Currency Statecraft with Chinese Characteristics: Chinese Expectations About the Influence of the e-CNY on RMB Internationalization

Through the increasing digitalization of its economy, China has become the world’s leading innovator in the development of fintech platforms. The rise of various digital currencies is a development that has attracted the interest of Chinese scholars and specialized commentators. In this regard, the recent introduction of the e-CNY as a new form of legal tender has further encouraged the proliferation of these analytical deliberations. Therefore, a better understanding of this complex phenomenon requires scrutiny through the lens of Chinese national perspectives. Hence, this chapter examines the views, expectations, forecasts, and suggestions offered by some of China’s leading experts about the plausible role that the e-CNY might eventually play in the incremental process of RMB internationalization, including both challenges and opportunities. Accordingly, this chapter covers four key themes as seen by Chinese thinkers: (1) e-CNY’s limits and potentials, (2) cross-border settlement, investment, and financing in RMB, (3) multiple CBDC bridge (mBridge), and (4) Hong Kong’s role in building offshore RMB markets. The chapter also offers an integrative assessment of the corresponding findings and their foreseeable ramifications.