China tested payments in e-CNY for deliveries of precious metals

The Shanghai division of the Bank of China made history by announcing the first-ever successful cross-border transactions utilizing the digital yuan. These groundbreaking transactions involved precious metals on the Shanghai Gold Exchange.

A foreign buyer, who wishes to remain anonymous, deposited a staggering amount of 100 million yuan (equivalent to around $14 million) into the accounts of the Central Bank. Subsequently, the Central Bank transferred the funds to the Shanghai Gold Exchange in the form of e-CNY. Accomplishing this feat required collaborative efforts between the Bank’s Shanghai branch and its counterpart in Hong Kong.

This cross-border payment experiment serves as a significant milestone in the practical application of China’s central bank digital currency (CBDC), as it tests the capabilities of the People’s Bank of China. The ultimate goal is to explore various scenarios where the digital yuan can be utilized effectively.

Hong Kong is another active participant in this experimental endeavor, as it also seeks to employ electronic yuan in cross-border retail trade. In fact, the Bank of China in Hong Kong initiated a project in July that empowered mainland Chinese shoppers to use digital yuan for purchases at over 200 retail stores within the city.

Prior to this achievement, the regulator reported triumphantly about the successful cross-border payments in e-CNY for energy resource supplies. Notably, these transactions involved iron ore and petroleum products.