The former head of China’s central bank digital currency (CBDC) research project, Yao Qian, has been expelled from the Chinese Communist Party and removed from his government position, following allegations of corruption.
According to reports in state-owned local media, Qian is accused of having abused “the right to recommend, formulate, and execute policies” and “abandoned the responsibilities of science and technology supervision” following a disciplinary review.
What Are Central Bank Digital Currencies (CBDCs)?
Central bank digital currencies, or CBDCs, are exactly what the name suggests: they're digital versions of a state’s fiat currency. But how does that differ from money sitting in a digital bank account, being used to make cashless transactions with debit cards? Why do governments even want to have CBDCs? And which countries have launched CBDC projects? What is a CBDC? CBDCs are digital versions of a state’s fiat currency. They are similar to stablecoins, which are pegged at a 1:1 ratio with a p...
In particular, he is accused of “sparing no effort to support specific technology service providers for personal gain,” though details about these conflicts of interest are not mentioned.
The report alleges that he accepted cryptocurrency, property, premium liquor, and dinners, and illegally borrowed money while in his position.
The exact scale of the bribes, or specific transactions, was not disclosed in the report, other than it was “very huge.”
Yao Qian's case has been referred to local authorities for prosecution. The executive had been under investigation since April 2024, according to local reports.
Who is Yao Qian?
Qian became the first head of the Digital Currency Research Institute at the People's Bank of China (PBOC) in 2017, where he worked on developing the Digital Yuan. Qian left China’s Central Bank in 2018 and has been serving at the China Securities Regulatory Commission since then.
Qian had been outspoken in the past when it came to expressing his personal opinions about CBDCs, suggesting that they could one day run on Ethereum (ETH) and incorporate smart contract functionality at the International Financial Forum (IFF) held in Beijing in 2021.
China’s digital yuan
The news comes as China’s own digital yuan CBDC, which first started limited testing in 2019, attracts more real-world use cases.
Lu Lei, a deputy governor at China’s central bank, told media in September that almost $982 billion in transactions had been carried out using China’s digital yuan by the end of June 2024.
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The digital yuan, which is undergoing a gradual rollout, is also now being used in jurisdictions outside mainland China.
Hong Kong now allows the CBDC to be used for payments in the city’s retailers, using a mobile wallet, according to Reuters.
The CBDC has also begun public use for cross-border payments.
In November 2023, it was reported that the digital yuan was used to settle a cross-border crude oil transaction for the first time, in an international trade involving Petro China.
