Technology

Breaking News: Bank of China’s Historic $14 Million e-CNY CBDC Gold Settlement Unveiled!

The Bank of China Completes World’s First Cross-Border CBDC-Powered Precious Metals Deal

The Bank of China has achieved a significant milestone in the world of digital currency by completing the first-ever cross-border Central Bank Digital Currency (CBDC)-powered precious metals deal. On December 20, 2023, the Bank of China’s Shanghai branch successfully conducted a 100 million yuan ($14 million) e-CNY CBDC settlement for gold via the Shanghai Financial Exchange International Board. This groundbreaking transaction highlights the growing acceptance and utility of digital currencies in international trade, particularly in the precious metals sector.

This successful settlement demonstrates the strategic role that the digital yuan, or e-CNY, is starting to play in China’s international trade efforts. Originally designed for domestic retail use, the People’s Bank of China (PBoC) and its partner banks have expanded the e-CNY’s scope to include international trade. This transaction follows the Bank of China’s recent facilitation of a $3.4 million digital yuan payment for iron ore, which was the first cross-border commodity deal using the e-CNY. The Bank of China, one of China’s largest commercial banks, was also among the first banks to join the pilot program for the digital yuan.

These recent activities signify China’s accelerated efforts to integrate the digital yuan into the global financial system. Chinese President Xi Jinping has emphasized the importance of CBDCs in cross-border trade. The PBoC is actively exploring the use of e-CNY with Belt and Road Initiative (BRI) partner nations and Association of Southeast Asian Nations (ASEAN) members. Furthermore, there have been developments in Singapore and Taiwan regarding the use of e-CNY. This cross-border settlement for gold clearly indicates China’s intention to position e-CNY as a key player in international finance.

Image source: Shutterstock

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