24.06.2024
Piotr Skowroński
166
24.06.2024
Piotr Skowroński
166
Recently, a court in China handed down a stiff sentence to a criminal gang that used digital yuan to launder money. It is worth saying that the use of the official digital currency of the Chinese central bank (Central bank digital currency, CBDC) has been at the center of heated discussions for years. The digital yuan, also known as e-CNY, is gaining popularity and the Chinese authorities intend to strictly control its use to prevent illegal activities.
The digital yuan began to be gradually introduced in the PRC from 2019 to control finances more strictly within the country, as well as to compete with the dollars in the global market. Already, more than 5 million Chinese entrepreneurs use e-CNY in their work, with the country's authorities touting the benefits of "transparency and trust" in the digital currency.
A high-profile case has been solved in Shaoxing City, located in Zhejiang Province. The subject of the crime is bleached digital yuan. Three members of a criminal gang were sentenced to prison terms ranging from seven to sixteen months. Crime? The criminals laundered 200,000 yuan (27,580$) in just four days, according to journalists. The modus operandi? As Chinese media outlet Mpaypass explains, the gang, consisting of Yuan, Zhang and Kou, used specialized chat rooms overseas to coordinate with an unknown "boss." They offered commissions of up to 1.5% to local merchants for exchanging digital yuan for cash.
This case is not the first in China. In January, another similar case was reported in Shanghai. Eight people were convicted of laundering about $1.379 million. That case also involved telecommunications networks.
It should not be forgotten that the digital yuan was developed not only for the purpose of better control, and monitoring of currency transactions in the country. The Chinese authorities are well aware that the digital yuan provides more opportunities to monitor their citizens. It is for this reason that they have introduced strict measures to control and regulate the use of CBDC, which is intended for mass use.
In addition, China has made the promotion of the digital yuan a national priority and has been testing it for several years in hopes that it will become a serious alternative to payment systems dominated by the dollar. Last year, Changchun Mu, director of the PBoC's Digital Currency Research Institute, stated that the goal is for the digital yuan to be available for all retail transactions.
Finally, it's interesting to note that despite China's known hostility to decentralized cryptocurrencies like bitcoin, it fully supports its digital yuan - more centralized than any other currency. In this respect, China's central bank's digital currency project is the most advanced in the world. The People's Bank of China (PBoC) is so confident in its CBDC that it has authorized its use within the territory of the "special administrative region" of Hong Kong (SAR).
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