China's Central Bank Digital Currency: Impact and Policy Implications

Theoretical research on central bank digital currency or CBDC is new and emerging. This article aims to contribute to existing studies on China's CBDC and examine the potential impact and implications of the digital renminbi on the economy, particularly on monetary policy and financial stability, as well as the fiscal system. China is at the forefront of digital currency globally, and the implications of launching the digital yuan are far-reaching, as it has the potential to transform the efficacy of state involvement in economic management, depending on the design characteristics of the CBDC.