Could China’s Digital Yuan Challenge U.S. Dollar Dominance?
By Drew Bernstein
Drew Bernstein, co-founder and co-chairman, Marcum Asia contributed an article to Forbes.com. The topic, the digital yuan, has been top of mind as it gains dominance in the global financial system. The article addresses this new contender in the race to define the future of money.
Could China’s new digital currency soon displace the dollar as the favored means of pricing commodities, powering global commerce, and banking foreign currency reserves? Might Americans someday soon have wallets full of digital yuan loaded on their smartphones?
While the promise of CBDCs is real, the U.S. dollar is unlikely to be toppled from its position as the global reserve currency anytime soon. The greatest threat to the dollar’s preeminence would be self-defeating policies that undermine the world’s confidence in America’s commitment to an open financial architecture and sustainable fiscal policies.