The People’s Bank of China (PBOC) plans to establish an international operation center for the digital yuan (e-CNY) in Shanghai.

Governor Pan Gongsheng announced the initiative during the Lujiazui Forum on June 18, aiming to boost the global adoption of the e-CNY.

He highlighted the growing role of blockchain and distributed ledger technologies in cross-border payments and real-time settlements.

Pan also addressed the opportunities and challenges of these innovations, including stablecoins, CBDCs, decentralized finance, and smart contracts.

While China supports blockchain advancement, cryptocurrency trading and mining remain banned.

🔗 Source: The Block

🧠 Food for thought

1️⃣ The e-CNY reflects China’s dual strategy: domestic challenges, global ambitions

China’s push to internationalize the digital yuan highlights a notable contrast between its domestic struggles and international aspirations.

Despite being one of the world’s most advanced CBDCs and expanding to 29 pilot cities, the e-CNY has processed only about $260 billion since its inception, significantly less than the $17 trillion processed annually by Alipay alone1.

This domestic adoption challenge persists despite numerous government incentives including lotteries and giveaways aimed at encouraging citizens to use the digital currency2.

Meanwhile, China’s international ambitions are evident in initiatives like the mBridge project (with Hong Kong, Thailand, and UAE), which has reduced cross-border settlement times to just 7 seconds and cut transaction costs by 98% compared to traditional SWIFT-based systems34.

The contrast illustrates how China’s CBDC strategy balances addressing immediate adoption challenges at home while simultaneously positioning for long-term global financial influence abroad.

2️⃣ Central banks worldwide are prioritizing practical payment solutions over CBDCs

Despite the rapid global exploration of CBDCs, central banks are taking a pragmatic approach to payment system improvements.

A recent survey revealed that 93.6% of central banks currently prioritize enhancing instant payment systems over CBDCs for improving domestic payment infrastructure5.

Recent People’s Bank of China developments