Asian Yuan May Join China Token
Chinese economists and analysts have long considered limiting their dependence on dollars. Now, they have proposed an idea for the introduction of a China token, the Asian Yuan. The analysts are hopeful that it could be used throughout Asia in place of dollars for trading.
Chinese Academy of Social Sciences (CASS) researchers published an article in the World Affairs Journal. The team included Zhou Xuezhi, Liu Dongmin, and Song Shuang, all hailing from the Institute of World Economics and Politics, a research unit of CASS.
The article was published towards the end of September. It shared the researchers’ views on Central Bank Digital Currencies (CBDCs) and insisted on a common token to reduce Asia’s dependence on USD.
How would the ‘China token’ work?
The analysts further proposed that this China token will work like most existing CBDCs. That’s why it would leverage distributed ledger technology (DLT). It would also be backed by a basket of currencies. In total, there may be 13 different currencies backing it to give it stability.
Most of the currencies involved are from Southeast Asian countries. Moreover, the medium of exchange of 10 members of the Association of Southeast Asian Nations (ASEAN) will be backing the digital currency. Consequently, Chinese Yuan, South Korean Won, and Japanese Yen will be part of the bundle.
Asian Yuan for monetary cooperation in the region
China seeks a central role in shaping the economy of Southeast Asia and bringing cooperation among the nations. Therefore, the proposal for introducing the Asian Yuan from government-backed researchers is yet another move toward this goal. The researchers also acknowledged this in the article by saying, "More than 20 years of deepened economic integration in East Asia has laid a good foundation for regional currency cooperation".
They also hinted that now the situation is ideal for introducing a pan-Asian token.
Besides, it would help the country strengthen its stature as a global leader in developing digital assets. This could be the next significant milestone as the digital Yuan has recently marked its widespread adoption with the pilot project.
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