The 2020 Olympic games scheduled for Tokyo would serve as a good platform for China to showcase its CBDC to the globe. China’s pilot program for its Digital Yuan is ongoing. However, US lawmakers are already making moves to prevent the use of the Digital Yuan at the Olympics, citing privacy concerns.
The latest development is a pointer to the unending rivalry between both countries. According to reports, some US lawmakers signed a letter to the Olympics committee imploring them to prohibit American athletes from using the Digital Yuan. China had earlier reported that it would ensure the adoption of its Digital Yuan during the Olympics events. Since the Olympics is a global sporting event, it would witness the influx of athletes with different nationalities into the country.
Senator Lummis Says US Athletes Would not Be Used as ‘Trojan Horse’
Three Republican Senators from the US were reported to have signed the letter addressed to the US Olympics and Paralympics Committee- Wyoming-born Senator, Cynthia Lummis and two other lawmakers, namely- Marsha Blackburn, Roger Wicker. In the letter, the lawmakers cited privacy reasons as being the inspiration behind the calls for the Digital Yuan boycott. Senator Lummis was quoted saying, ”The US cannot allow its athletes to be used as a trojan horse to increase the Chinese Communist Party’s ability to spy on the United States.”
Before now, a certain US financial expert had equally accused China of conspiring to use its CBDC to spy on citizens’ transactions. The People’s Bank of China dismissed claims relating to privacy, saying the proliferation of private payment services informed its decision to issue a central bank digital currency. Moreover, China plans to usurp the hegemony of the US Dollar on global financial and banking systems. In view of this, the PBOC believes fronting a Digital Yuan to bring China closer to its goal.
Despite the calls for boycott, the US has not fared better in terms of privacy. Better put, the US has not come to equity with clean hands as it came under heavy criticism for recruiting experts who would decrypt the privacy-based crypto Monero and Bitcoin’s Lightning Network. Besides, the Bank of America (BOA) and other banking institutions are actively involved in proposed plans to issue a digital dollar. The implications of CBDCs are still being considered around the world.
China’s CBDC Records Massive Transactions
Meanwhile, China has made giant strides on its Digital Yuan. The PBOC recently reported over 70 million transactions during the first phase of the CBDC trial. It also claimed to have recorded over $5 billion in transaction volume. Deploying the Digital Yuan during the Olympics games may worsen the rivalry and trade wars between the US and the Asian giant.
As China continues to test its CBDC across all scenarios, its disposition towards cryptocurrencies have been mostly unfavorable. Crypto miners were recently shown the way out of the country, as Chinese regulators claimed that their operations affected electricity supply and caused damage to the environment.