Sen. Pat Toomey, a member of the Senate Banking Committee, urged Treasury Secretary Janet Yellen and Secretary of State Antony Blinken to study China’s use of the digital yuan at the Olympics. He says that the eCNY poses a threat to the interests of the US economy and national security.
Beijing’s Winter Olympics have given CBDC an international launchpad — the eCNY has been approved as a payment method for guests and residents of the Olympic village. Domestically, the digital yuan has been tested since 2019.
He noted that the eCNY could serve as an effective tool to circumvent U.S. sanctions and conduct illicit transactions. In addition, Chinese authorities would gain “more opportunities to bypass international financial rules and advantages for the ‘pioneer’ in setting standards in global digital payments.”
Toomey also worries about Beijing’s launch of the state blockchain platform BSN, which will become the technological backbone of the One Belt One Road initiative.
Although there is interest in distributed ledger technology, the Communist Party of China (КПК) regards cryptocurrencies as a threat to “digital authoritarianism,” which gives the United States a chance to lead in innovation in this field, the senator said. He cited individual freedom and other principles shared by the country as backing.
Toomey proposed on March 7 to hold a special briefing on the digital yuan.
As reported, Republican Senators Marsha Blackburn, Cynthia Lummis and Roger Wicker sent Susanne Lyons a letter demanding that athletes be prohibited from using e-CNY.
Earlier, members of the House Committee on National Security, International Development and Monetary Policy in the US Congress expressed concern about China’s leadership in CBDC development.
Earlier, similar concerns were expressed by John Ratcliffe, Director of National Intelligence.
The Chinese authorities expect that the launch of the CBDC will bolster the yuan’s position on the international stage and break the dollar’s dominance.
Matthew Graham, head of Sino Global Capital, said that a digital yuan-based payments system could replace the morally outdated SWIFT system built on the American currency.
Analysts at Deutsche Bank also suggested that the use of the eCNY in external trade could undermine the dollar’s dominance.
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