China CBDC Tracker

China is currently considered to be in the launch phase. Although China’s CBDC is technically labeled a pilot (for example, see reporting in Reuters and the Wall Street Journal), this use of the term is misleading. Where most countries use terms like “pilot,” “proof-of-concept,” or “experiment” to describe CBDCs tested in closed environments, the People’s Bank of China uses this term to describe a CBDC that is largely open to the public in comparison. For example, in 2022, it was reported that over 260 million CBDC wallets were opened in China.

CBDC History and Development

China may have the longest-running CBDC research. In 2014, the People’s Bank of China set up “a task force to study digital fiat currency.” In 2016, the People’s Bank of China expanded its efforts by establishing the Digital Currency Institute. At the end of 2017, the project was expanded, and major financial institutions were brought in for further research and development.

In 2019, the People’s Bank of China published a paper outlining its vision for a CBDC (referred to as the E-CNY). The paper states that the goal of a Chinese CBDC would be to replace cash, improve financial inclusion, and improve cross-border payments. To achieve this, the paper says that a Chinese CBDC should comply with anti-money laundering regulations, be programmable, earn no interest, and have the flexibility to be changed in the future.

In 2020, the People’s Bank of China launched a CBDC pilot in four Chinese cities: Shenzhen, Suzhou, Xiong’an, and Chengdu. Citizens in the four selected cities gained access to the CBDC through a lottery system. For example, in Shenzhen, $1.5 million in CBDC was given to 50,000 participants spend at 3,389 locations. Over 1.91 million people applied to be a part of the program. Similarly, in Suzhou, $3.1 million in CBDC was given to 100,000 participants. Money received in the lottery, however, must be spent within a limited time frame before expiring. By the end of 2021, there were 261 million users in the pilot that collectively made $13.8 billion worth of transactions with 8 million merchants.

On March 31, 2022, the People’s Bank of China expanded the pilot to Tianjin, Chongqing, Guangzhou, Fuzhou, Xiamen, and six cities in the province of Zhejiang. With this expansion also came a flurry of lotteries, discounts, and other promotions to attract adoption. By the end of the year, there was reportedly 13.61 billion yuan ($1.81 billion) in circulation. However, by December 2022, a former People’s Bank of China research director said, “The results are not ideal … usage has been low, highly inactive.”

The CBDC itself is used via a mobile app. The app can connect to an individual’s bank account, provide QR codes for transactions, and establish multiple wallets within a single account. However, individuals are restricted in terms of how much CBDC they can accumulate and spend based on how much personal information they are willing to provide.

The People’s Bank of China has also been working with the Bank for International Settlements on a wholesale CBDC pilot (referred to as Project mBridge). As the Bank for International Settlements describes it, Project mBridge “seeks to solve some of the key inefficiencies of cross-border payments, such as high costs, low speed and transparency, and operational complexities. At the same time, the project aims to safeguard currency sovereignty and monetary and financial stability for each participating jurisdiction, guided by the principles of "do no harm", compliance and interoperability.”

It is important to be mindful of some of the motivations that may be at play. People’s Bank of China official Mu Changchun said, “In order to protect our currency sovereignty and legal currency status, we have to plan ahead” when speaking of his work on advancing a CBDC in China. So in addition to expanding the Chinese government’s surveillance and control over the population, it’s likely that the People’s Bank of China sees CBDC as a way to combat the rise of cryptocurrency. Unlike other countries, China’s work on CBDC started long before Facebook’s Libra made headlines. However, it’s unlikely to be a coincidence that the Chinese government’s hostility toward cryptocurrency culminated in a ban on cryptocurrency trading and mining shortly after its CBDC pilots were launched.

In 2024, reports emerged that the CBDC was rarely used in practice. Despite government employees receiving their salary in the CBDC, many immediately transfer their balances to their traditional bank accounts. For example, one participant said, “I prefer not to keep the money in the e-CNY app, because there’s no interest if I leave it there. There are also not so many places, online or offline, where I can use the e-yuan.”

In September 2024, People’s Bank of China deputy governor Lu Lei reportedly said there had been a total of 7 trillion yuan ($982 billion) transactions using the CBDC. While not explicitly clear, this number appears to be the total for the past four years.

Yao Qian, former head of the People’s Bank of China’s Digital Currency Institute, was removed from the Chinese Communist Party in November 2024 for allegedly engaging in corruption. State-owned media reported that he "betrayed his original mission” and “spared no effort to support specific technology service providers for his own selfishness.”

Human Rights and Civil Liberties Concerns

China is riddled with major abuses of human rights and civil liberties. The U.S. Department of State reported significant human rights issues spanning genocide, arbitrary imprisonment, forced sterilization, extrajudicial internment camps, restrictions on expression, surveillance, and much more. Because violations are so widespread, the considerations of the risk a CBDC could pose will be conceptualized within the risks to financial privacy, financial freedom, and corruption. A CBDC could be used to worsen all of these issues.

Financial privacy is immensely important for the protection of human rights and civil liberties because financial transactions reveal people’s professions, relationships, religion, political ideals, and more. The Chinese government has used the financial system as a tool for surveillance in targeting protestors so much that it was reported in 2019 that Hong Kong protestors were afraid to use metro cards out of fear they might be tracked. However, it’s not just protestors that fear being tracked. The ongoing genocide against Uyghurs and other Turkic Muslims is also a significant concern. In both cases, things could be made worse if a CBDC were implemented to give even greater financial surveillance and monitoring abilities to the Chinese Government.

Financial controls are also a significant risk. As explained by Freedom House, “China is home to one of the world’s most restrictive media environments and its most sophisticated system of censorship, particularly online.” In 2022, 43 journalists were imprisoned and in 2018, the social credit system was expanded to restrict the travel of millions of Chinese citizens. A CBDC could make matters worse by providing authorities the tools to further cut off journalists from society and choke off dissenting voices. Unfortunately, a CBDC could be used as another tool in this effort. Across the world, governments have often turned to freezing and seizing the money of activists, political rivals, and protestors to undermine the opposition. A CBDC would make such initiatives easier by allowing governments to take direct control of each citizen’s finances.

Despite efforts to severely punish corruption, “corruption remains rooted in the one-party system, which does not tolerate the institutions necessary for effectively addressing graft—such as a free press, independent civil society groups, and impartial courts.” That much is evident by the corruption immediately surrounding the creation of China’s CBDC. Yao Qian, former head of the People’s Bank of China’s Digital Currency Institute, was removed from the Chinese Communist Party in 2024 for allegedly engaging in corruption. State-owned media reported that he "betrayed his original mission” and “spared no effort to support specific technology service providers for his own selfishness.” The existence of pervasive corruption is a major concern with CBDCs because it calls into question any promises that might be made by the government to limit surveillance, control, or other risks of CBDCs. Furthermore, the existence of corruption calls into question whether CBDC policies might be designed to exert political favoritism through subsidies, price controls, or other targeted restrictions.

For additional information on concerns regarding violations of human rights and civil liberties, see the following reports by Amnesty International, Financial Tyranny Index, Freedom House, Human Rights Watch, Privacy International, and the U.S. Department of State. For additional information on concerns regarding the risks of CBDCs, see the following webpage and report by the Cato Institute: The Risks of CBDCs and Central Bank Digital Currency: Assessing the Risks and Dispelling the Myths.

For additional information regarding metrics, the methodology page explains each of the data points and provides their respective sources.