China’s mBridge digital currency platform has achieved a significant milestone, processing over $55 billion in cross-border transactions since its pilot launch in 2022. The platform is supported by central banks from China, Hong Kong, Thailand, the UAE, and Saudi Arabia, and leverages central bank digital currencies (CBDCs) to facilitate international payments. Notably, China’s digital yuan, known as the e-CNY, accounts for approximately 95% of the total volume, indicating a fundamental shift in how cross-border payments are conducted.
Explosive Growth in Transaction Volume
Since its inception, the mBridge multi-CBDC platform has completed more than 4,000 cross-border transactions, amounting to a staggering $55.5 billion—a sharp rise from less than $25 million in its early days. Reports from the Atlantic Council highlight this meteoric growth, reflecting China’s aggressive strategy to bolster its digital currency infrastructure. Furthermore, domestic transactions using e-CNY have surged, with the People’s Bank of China (PBOC) revealing that over 3.4 billion e-CNY transactions have been executed, together worth around 16.7 trillion yuan (about $2.4 trillion), marking an 800% increase compared to figures from the previous year.
Among the participating central banks, the influence of the e-CNY is unmistakable, solidifying its status as a leader in this innovative payment landscape. Analysts view this growth as a crucial component in expanding China’s influence in global finance, positioning the mBridge platform as a pivotal alternative to traditional dollar-based systems.
Enhancing the e-CNY as a Store of Value
To further enhance the utility of the e-CNY, the PBOC is set to introduce a framework that enables commercial banks to offer interest on digital yuan balances. This initiative aims to transform the e-CNY from merely a transactional tool into a viable store of value, which could fundamentally change consumer behavior around digital currency. Deputy Governor Lu Lei expressed that the move is geared towards transitioning the e-CNY to function as a “digital deposit currency,” allowing banks to better manage digital assets akin to traditional deposits.
Analysts believe these developments could significantly contribute to the internationalization of the yuan, emphasizing a gradual shift in global financial corridors facilitated through advanced digital infrastructures.
The Shift Towards Financial Independence
After supporting the launch of mBridge through its Innovation Hub in 2021, the Bank for International Settlements (BIS) exited the project in 2024, describing the departure as a “graduation” that underscores mBridge’s readiness for independence. The BIS aims to distance itself from platforms associated with sanctioned countries and has redirected its efforts towards Project Agorá in collaboration with various Western central banks.
Despite concerns, mBridge is not positioned as a direct competitor to the US dollar. Instead, it embodies a crucial part of a broader movement toward alternative global payment systems. The collaborative efforts from participating nations are aimed at mitigating reliance on established dollar-centric networks.
A Promising Future for Cross-Border Digital Payments
As the mBridge initiative continues to evolve, its promise lies in enhancing the efficiency, transparency, and cost-effectiveness of cross-border transactions among its partners. With the rise of digital currencies globally, mBridge could play an increasingly central role in reshaping international financial infrastructure, particularly across Asia and the Middle East.
