China’s Digital Yuan App Gets Update as Police Deal with First-Ever CBDC ‘Fraud’ Case
The central People’s Bank of China (PBoC) has added new functionality to its pilot digital yuan app – but it appears that some citizens are already trying to commit crimes using the new token, and have attempted to use it to launder money.
Per IT Home, the PBoC’s app, which debuted in 11 cities and regions earlier this year, is set for a facelift – its first-ever – in the coming days, with an update that will respond to Apple’s next iOS update.
The PBoC app update, named 1.07, has been designed to harness new functionality on iPhones running the official digital CNY app. Apple’s iOS 15.4 update is expected to drop sometime this week.
The report said that the PBoC’s update will include “improved accessibility services,” as well as voice-inputted passwords and improved face recognition functions. Improved functions for retrieving lost or forgotten login details and passwords have also been added, along with other functions. These features will reportedly all go live once iPhone-using digital CNY holders update both the app and their operating systems.
However, not all firsts for the PBoC’s digital coin have been so auspicious: The Chinese judiciary is about to hear its first-ever case involving digital yuan fraud, reported JX News. Cyberpolice in Jiangxi Province have arrested and charged a man surnamed Wang (aged 24). He was accused of posing as a public prosecutor and duping a female victim in Xinyu into sending him “hundreds of thousands of CNY” in digital form in October last year.
The police force said that the man then proceeded to contact an online money laundering gang through a social media platform. The gang allegedly instructed him to download a (commercial bank-run) digital CNY wallet and funnel the woman’s funds through this address. Wang then allegedly transferred these funds to accounts at banks before finally transferring the funds to an Alipay account.
Police say they recovered over USD 47,000 worth of funds, although their months-long search involved an exhaustive trawl that took them through online and brick-and-mortar institutions.
Meanwhile, experts say that the digital CNY’s rollout may still be some way off. Speaking at a roundtable event hosted by the Economic Daily and reported via DQ Daily, Li Yiyang, a Senior Economist at the China Construction Bank’s Research Institute, claimed that “technological improvements” were still needed before a nationwide rollout.
Li called the process a “long-term evolution,” which required constant “dynamic upgrading.” The economist added that “the impact” the coin will have “on the financial system is still uncertain” – another reason why the PBoC is still reluctant to roll out the token beyond its pilot areas.
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