to lower interest rates below zero with little difficulty; to issue cash directly to those
most in need; and to see more precisely who has money and how it is spent.
In China the central bank is not trying to reinvent monetary policy—at least not yet. Its
motivations derive from more immediate challenges. Given the rise of mobile payments,
it worries that the big tech platforms have too much power. The digital yuan will offer
an alternative. It will also give China a conduit for moving money across its borders
without having to rely on swift, a global payments system that comes under American
influence. But China’s first objective is much more basic still: to check whether the
technology behind the digital yuan works and whether people actually want to use it.
Money has been around for some 3,000 years. This update will take time.
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