China launches digital currency for 2022 Winter Olympics

Deepak Gupta February 2, 2022
Updated 2022/02/02 at 12:34 AM

At Beijing Winter Olympics, which starts this Friday, February 4th, will have more than sports competitions. THE China The Digital Yuan, the official payment method for this edition of the games. Athletes even received ski gloves and NFC watches for payments. And despite the innovation, it has generated controversy.

China Forces Digital Yuan, Virtual Currency Different From Crypto

During the event, only the Digital Yuan, cash and Visa cards, which is one of the sponsors of the games. According to the director of Technology and Operations at Tecnobank, Adriana Saluceste, the news may actually be good news for the future of financial transactions. “THE Digital Yuan has become popular in China as an alternative means of payment to existing digital wallets. In the last two years, the China put the coin in the testing phase and saw in the Winter Olympics an appeal for a real proof of the virtual currency also among foreigners”, he explains.

The expert recalls that adopting digital currencies streamlines the process of transactions made and/or received abroad. Small deposits can be made anonymously and, as it is a backed currency – which differentiates it from cryptocurrencies – it is more difficult to use it for illicit purposes.. “It remains for us to wait for this big test and to know if the Digital Yuan will have an improvement in the user experience to compete with the existing payment applications”, he highlights.

Last year, the China declared illegal all financial transactions carried out with cryptocurrencies. The decision was taken, according to the government, to curb illegal money laundering and fundraising. THE Central Bank of China stated that, over the last few years, trade with cryptocurrencies altered the economic and financial order, increasing money laundering, pyramid schemes and other criminal activities.

What is the difference between a digital currency and other payment methods

THE pix it is a point-to-point payment, instant and available 24 hours a day, which facilitated payment transactions that occur mainly between individuals. In turn, the debit card is a form of payment in cash, as well as the pix or the use of cash.

“Already digital currency it is an extension of the physical currency, but for use in a virtual environment, issued and guaranteed by the federal monetary authority. With it, it is possible to move money that does not physically exist. These initiatives are interconnected to allow a greater reach of digital banking services”, explains Adriana.

United States concerned about the use of its athletes’ data

The US government has asked its athletes not to use the Digital Yuan for fear of leaks and misuse of data. But there are ways to ensure that doesn’t happen. According to the expert, currently the security of digital currency is the same as that of paper money, but the government can more easily monitor the money supply. This security will be closely tied to the security of operators, while the authorities in China control the Digital Yuan. “What can be done is a use of the same technologies as cryptocurrencies blockchain, a system that allows tracking the sending and receiving of information over the internet, in addition to having a protocol that dictates the production of new assets”, he concludes.


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