PBoC Says Digital Yuan Tests Focus on Small Transactions After Rumored Property Sale

China’s central bank has apparently played down rumors of a property transaction settled with its in-the-works digital currency, saying that current tests only involve small transactions.

• According to a report from Chinese news source Global Times on Monday, internet users had suggested a house sale had been conducted in the major city of Shenzhen.
• The seller had apparently been paid with a large amount of the digital currency being developed by the People's Bank of China, but had not been successful in converting it into the traditional version of the currency.
• Later, an employee at the central bank reportedly told news source Sina that trials of the digital currency are currently solely focused on smaller retail transactions and that scenarios involving larger-sized transactions are not yet being addressed.
• The digital money is legal tender equivalent to fiat-based yuan and is 1:1 exchangeable with cash, they added.
• The central bank digital currency (CBDC) is currently being trialed across a number of regions, with an expansion into cities like Hong Kong also announced in the last two weeks.
• As well as banks, the CBDC is soon to be tested at companies including several within the Tencent group.

Also read: Chinese Ex-Banker Says Digital Currency Should Replace Fiat Money