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China’s Digital Yuan in Danger? Former Head Yao Qian Faces Discipline and Investigation on Unknown Allegations

Last Updated April 26, 2024 1:09 PM
Teuta Franjkovic
Last Updated April 26, 2024 1:09 PM
By Teuta Franjkovic
Verified by Peter Henn

Key Takeaways

  • Yao Qian is under investigation for alleged disciplinary and legal violations, but it has not been revealed what these are.
  • Current investigation may not directly impact the rollout, but scrutiny over his methods could hint at broader issues.
  • China’s intensified anti-corruption efforts coincide with Qian’s investigation.
  • Investigation is unlikely to significantly affect the digital yuan’s technology and strategic objectives.

Yao Qian, the key figure behind China’s central bank digital currency (CBDC) initiative, is currently under investigation  for alleged, unspecified, “violations of discipline and law”.

While the investigation into Qian may introduce some doubts, it is unlikely to fundamentally affect the digital yuan itself, however.

Yao Qian Faces Scrutiny by Central Committee

Qian spearheaded the People’s Bank of China’s (PBOC) efforts to develop and launch the digital yuan. This endeavor influenced other countries to explore their own CBDCs.

After leaving the PBOC in 2018 , Qian joined the China Securities Regulatory Commission. Qian, who serves as Director of the Science and Technology Supervision Department and the Director of the Information Center at the China Securities Regulatory Commission, is currently under investigation for serious disciplinary and legal violations, according to a report by the Central Committee.

According to the report :

“Yao Qian, Director of the Science and Technology Supervision Department and Director of the Information Center of the China Securities Regulatory Commission, is suspected of serious violations of discipline and law and is currently under investigation by the Central Committee.”

The Commission’s disciplinary team and Shanwei City’s supervisory committee are conducting the investigation and review.

Probe into Yao Qian’s Role Raises Concerns for Digital Yuan Initiative

The investigation into Yao Qian’s activities holds significant implications, especially for China’s ambitious Central Bank Digital Currency (CBDC) initiative. As a principal figure in the development of the digital yuan, Qian’s involvement in this investigation casts uncertainty on the future direction of China’s digital currency endeavors.

China has been a pioneer in the exploration of CBDCs, with the digital yuan project has garnering considerable global attention and scrutiny. Consequently, any issues involving key figures linked to this initiative are meticulously observed. This is because they could affect the progress of China’s digital currency efforts and its overall role in shaping the global financial landscape.

China’s Anti-Corruption Drive Intensifies

Investigation into Qian occurs while China is making efforts to combat corruption within its state apparatus. In the previous year, China scrutinized 54 officials  affiliated with and overseen by the Central Committee of the Communist Party of China (CPC), aiming to uphold standards for ‘high quality economic and social development.’

Simultaneously, authorities examined 2,480 officials at department and bureau tiers, alongside over 20,000 officials at county and division levels.

Digital Yuan Unfazed by Investigation, Broader Forces at Play

The digital yuan has been designed with a balance in mind. It aims to enhance privacy protections while also ensuring the government can combat crimes such as money laundering and terrorism financing. Yao Qian has highlighted that the digital yuan would not inherently allow the government to monitor every transaction​.

Globally, the push towards Central Bank Digital Currencies (CBDCs) reflects countries changing monetary systems to align with digital advances. Their adoption does not hinge solely on the standing of one individual. Rather, they depend on on broader national and international monetary policies and technological developments​.

Therefore, while the investigation of a prominent figure like Yao Qian might stir uncertainty, the underlying technology and the strategic motivations for the digital yuan are unlikely to be significantly derailed by such developments.


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