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Chinese digital currency used for first time in cross-border oil transaction

by Karen Faulkner, Worthy News Correspondent

(Worthy News) – The digital yuan was used for the first time to finalize a cross-border oil deal when, on October 19, PetroChina International bought 1 million barrels of crude from an undisclosed seller using only the Chinese central bank digital currency (CBDC), Coin Telegraph reports.

While the purchase was announced by China’s Shanghai Petroleum and Natural Gas Exchange (SHPGX), the price of the transaction has not been publicized, Coin Telegraph said.

Described by Coin Telegraph as representing “major strides” for de-dollarization and CBDC, the use of CBDC to close the deal was requested by the Shanghai Municipal Party Committee and Municipal Government.

“The crude oil deal also marks an overall major step in the use of the yuan on the international market and in the global movement toward de-dollarization,” Coin Telegraph asserted in its report. “In the first three quarters of 2023, the use of the yuan in cross-border settlements was up 35% year-on-year, reaching $1.39 trillion.”

Also on October 19, First Abu Dhabi Bank announced that it had signed an agreement on digital currency with the Bank of China, the state-owned commercial bank. “China and the United Arab Emirates, of which Abu Dhabi is part, are participants in the mBridge platform to support cross-border transactions with CBDC,” Coin Telegraph explained in its report. “MBridge intends to launch as a minimum viable product next year.”

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