US lawmakers issue warnings about digital yuan as Winter Olympics kicks off
With the opening ceremony of the Beijing 2022 Winter Olympics completed and all competing athletes currently in China, two members of Congress are warning of the potential dangers of using digital yuan at the events.
According to a Friday report from Reuters, Pennsylvania Senator Pat Toomey sent a letter to Secretary of State Antony Blinken and Treasury Secretary Janet Yellen on Thursday expressing concern that the Chinese government could use the games to promote greater adoption of its central bank digital currency (CBDC), the digital yuan. The country has been conducting trials of the CBDC since April 2020, later announcing foreign athletes and visitors would have the opportunity to use it during their time at the Olympic Games.
Toomey claimed that the digital yuan rollout among an international crowd could help to set a standard in cross-border payments, potentially threatening U.S. interests. The Federal Reserve has floated the idea of releasing a digital dollar, but has not reached a decision to do so. The Pennsylvania Senator reportedly asked the State and Treasury Departments to report on the number of foreign visitors using China’s digital yuan to determine if the Olympics rollout could provide any useful information for U.S. officials considering a CBDC.
“The importance of remaining a leader in the global digital economy and supporting new innovations like digital currencies is a significant domain of strategic competition with other countries, including China,” said Toomey.
Many U.S. lawmakers are offering their support for those competing at the games, with some, including Minnesota Representative Tom Emmer, offering a last-minute warning to athletes not to use digital yuan while in China. Emmer has previously referred to China as living under "digital authoritarianism” in proposing legislation to limit the Fed's ability to issue a CBDC.
Good luck to all the @TeamUSA athletes competing in the Olympics.
Word to the wise - Do. Not. Accept. Any. Digital. Yuan.
In July, a group of three senators sent a letter to the U.S. Olympic and Paralympic Committee claiming that the Chinese Communist Party could use the CBDC to surveil visiting athletes both while at the games and upon their return to the United States. The committee reportedly suggested members of Team USA leave their smartphones at home and only use “burner” phones while in China, given the former could be infected with “malicious software.” At the time of publication, the Team USA Instagram page continues to post its own stories and share those from participating athletes’ accounts.
Related: COVID restrictions stymie digital yuan rollout at Beijing Winter Olympics
The Beijing 2022 Winter Olympics is the first major testing ground for the country’s CBDC among a broad group of international visitors. Since its launch almost two years ago, transactions using the digital yuan have totaled more than $13 billion, with roughly 10 million merchants activating digital wallets for the CBDC by November 2021.