The world seems awash in cryptocurrency fever. Bitcoin prices have risen more than fivefold since the pandemic started, creating a wave of interest in digital assets. But this crypto-sideshow has been diverting our attention from the main issue—the fact that Beijing has spent the last eight years creating a digital version of the Yuan, and through it, seeks to control its citizenry, export digital authoritarianism and threaten the U.S. dollar as the world’s reserve currency.
Central banks worldwide have been discussing digital currencies for several years, but few countries have been as singularly focused on the issue as China. Over the past decade, Chinese paper bills and coins have all but disappeared. They’ve surrendered to WeChat and Alipay QR codes on smartphones. The Chinese digital Yuan project—also referred to as the Digital Currency Electronic Payment—is the next iteration of this trend, and it’s been years in the making.