The administration of Joe Biden, the current US president, is concerned about the digital yuan, China's national digital currency, Bloomberg has reported citing anonymous sources.
According to the publication, the US is concerned that the digital yuan will become a threat to the dollar's status as the world's reserve currency.
As a result, officials from various government departments are increasing their efforts to better understand the potential threats posed by the Chinese initiative.
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While it looks like officials in the country are not particularly concerned about the short-term impact of the digital dollar on the dollar, it appears the long-term implications of the Chinese currency are a concern, which is the reason why officials have started to intensify their efforts to understand how the digital yuan will be distributed and whether it will serve to bypass trade sanctions.
The Asian giant started working on the development of its digital yuan in 2019. Since then, the country has conducted tests in various regions in order to experiment with the actual uses of the currency, whose development is quite advanced.
Meanwhile, last month it was known employees at the Federal Reserve Bank (FRS) of Boston and the Massachusetts Institute of Technology (MIT) plan to complete their work related to a prototype national digital currency (CBDC) by July.