How China’s digital currency works
China is aiming to become the first country to roll out its own digital currency. But it looks like actually using the new digital yuan could look a lot like other popular mobile payment apps like Apple Pay or Google Pay.
Dong Ximiao, a research fellow at the National Institution for Finance and Development, explained in an interview with CCTV on Monday how China’s long-awaited sovereign digital currency will work. Transactions could be made through NFC on smartphones, the same technology used by Apple, Google, Samsung and others to allow people to pay by waving their phones at a special terminal.
“The digital currency can be conveniently used without the internet,” Dong said. “Users can make transactions or payments by bringing two mobile phones with electronic wallets close to each other.”
Dong’s explanation sounds similar to how many digital wallets work these days. Users can exchange money in their bank accounts for the digital currency, which is then deposited in an electronic wallet, Dong said.
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