Soochow Securities is the first financial institution to use the central bank digital currency (CBDC) in the securities market.
Through the firm’s mobile app, investors can now purchase wealth management products with the digital yuan. This marks an important milestone in the adoption of the e-CNY and its use in the financial sector.
The People’s Bank of China (PBOC) has been piloting the e-CNY in several cities since 2020. Last year, the amount of e-CNY in circulation across these cities reached 13.61 billion yuan (US$2 billion).
This amount accounted for 0.13% of the M0 supply — the total currency in circulation including bank reserves. The PBOC plans to include the e-CNY in its M0 calculations at the end of 2022.
As more financial institutions begin to adopt the digital yuan, the use of the e-CNY is expected to increase. This could help to improve the efficiency of financial transactions and reduce costs.
It could also provide opportunities for innovation in the financial sector.
