Most of the press on the recent Boao forum focuses on calls to jointly tackle Climate change. A high-minded piece of theater, since the 100 companies responsible for 71% of the world's GHG emissions have yet to be called on the carpet in any major forum.
But the real play went largely unnoticed: former PBOC governor Zhou Xiaochuan assuring the audience that China's upcoming digital currency would have "no major impact on world financial markets". After all, its use is "currently found in small retail operations."
So yes, the current gloriously inefficient and cumbersome system of global payments is safe, for now, as is the 16 trillion of US payments held in offshore accounts, the lube for this antiquated contraption.
"People have to understand the new digital yuan in the context of the burgeoning IoT space," says Jimmie Jeremejev, "as well as 5G technology, which China also has a huge lead on. The near future of trade is a streamlined system of containers, warehouses, and delivery transport talking to and paying each other. Such efficiency is not possible with human clearance through traditional banks and paperwork, but only through blockchain-aided transactions."
"China is certainly not trying to replace the dollar as the global reserve currency," says Edward Lehman. "However, because the digital yuan is poised to be the currency of the 4th industrial revolution, the dollar's role as reserve currency may certainly atrophy."