China’s eCNY a Threat to U.S. Interests, Pat Toomey Says as He Requests Answers From Government Leaders

U.S. Senator Pat Toomey shared his concerns about a China central bank digital currency with Treasury Secretary Janet Yellen and Secretary of State Tony Blinken in a letter last week.

Addressing the policy makers, Toomey wrote:

“I write to request your engagement on a momentous development in Beijing this week: the rollout of the world’s first major central bank digital currency (CBDC) to a foreign audience.

While the United States is still evaluating the concept of a digital dollar, China is using the Beijing Winter Olympics as an international test for the digital yuan (eCNY), which has been piloted domestically since 2019.”

The Pennsylvania Senator also addressed the eCNY’s dangers to the U.S.:

“Analysts have raised the eCNY’s potential to subvert U.S. sanctions, facilitate illicit money flows, enhance China’s surveillance capabilities, and provide Beijing with ‘first mover’ advantages, such as setting standards in cross-border digital payments.”

Noting that “Beijing has also launched the first state-backed global distributed ledger infrastructure, the Blockchain-based Services Network (BSN),” the Senator stressed the opportunity for the United States that followed China’s attack on cryptocurrency in the country

“China’s crackdown presents an opportunity for the United States to be the forerunner of crypto innovation, grounded in individual freedom, and other American and democratic principles.”

Toomey went on saying:

“Given the prospective threat to U.S. economic and national security interests, I request that the Treasury and State Departments closely examine Beijing’s CBDC rollout during the Olympic Games.”

In conclusion, the Senator requested some intelligence to be provided before March 9 on the Chinese CBDC, such as how the digital yuan was distributed, strategies employed to advance eCNY adoption by Chinese and non-Chinese persons, eCNY adoption rate by foreigners, total issuance of the eCNY after the Olympic Games, conflicts to U.S. interests and maybe most importantly, lessons learned from China.