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China Breaks CBDC Mold by Paying Interest on Digital Yuan

China Breaks CBDC Mold by Paying Interest on Digital Yuan

Author:

Global Cryptocurrency

Published:

2026-01-01 19:53:02

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BTCCSquare news:

China's central bank has upended global CBDC conventions by introducing interest payments on digital yuan holdings starting January 1, 2026. Verified wallets (categories 1-3) will earn demand deposit rates, with quarterly settlements on the 20th of final month—a deliberate exclusion of anonymous category-4 wallets.

The PBOC simultaneously extended deposit insurance coverage to digital yuan balances, addressing a key adoption barrier. By late 2025, the e-CNY ecosystem already boasted 230 million wallets processing 16.7 trillion yuan in transactions—figures that may accelerate with this yield incentive.

This policy shift redefines CBDC utility beyond transactional use cases, potentially influencing other sovereign digital currency projects. Market observers note the MOVE could pressure commercial bank deposits while testing theoretical limits of monetary policy in the digital age.

By:

India’s RBI Advocates CBDCs Over Stablecoins to Safeguard Financial Stability

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