In the US, Joe Biden's administration sees China's digital yuan as a threat

In the US, Joe Biden's administration sees China's digital yuan as a threat

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In the US, President Joe Biden's administration is reportedly concerned about the long-term effects of the prospect of China's digital yuan, which is in the testing stages and will be implemented in 2022, over the status of the US dollar as the world's reserve currency.

In the US, government officials have given their research more intensity to better understand the possible threats posed by China's initiative, Bloomberg reported, citing unnamed sources.

Digital yuan threat, long-term, not short-term

Officials at the U.S. Treasury, State Department, Pentagon and National Security Council are not affected by the short-term effects of a digital yuan or China's digital currency electronic payment (DCEP) system on the dollar, but long-term threats to the U.S. global reserve currency status are a major concern. According to the report, officials have begun work to understand how to distribute the digital yuan and whether it works on trade sanctions.

Since last year, China has begun experimenting with digital yuan at payment points in major cities and in many areas of social life, and according to local officials, they are known to have come a long way in this regard. China plans to get rid of cash altogether and switch to the digital yuan in 2022.

Fed Chairman Jerome Powell, on the other hand, said that they were not in a hurry about the digital dollar, but continued to work.

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