Despite China’s ambitious plans for its digital currency, the e-yuan will struggle to become a lead player in international trade finance without notable changes, most importantly to capital controls.

The prospect of China’s Cross-Border Interbank Payment System vying with or supplanting Swift grabbed attention in the wake of Russia’s invasion of Ukraine. But CIPS isn’t ready for the big time. It is too small and underdeveloped, and is a policy vehicle dominated by Beijing for the purpose of globalizing the yuan.

Chinese policymakers may have become more relaxed about fluctuations in the yuan, but no one should doubt their willingness to intervene if the currency moves too far in either direction.

As the rest of the world’s central banks try to catch up with China, one can only wonder about the potential of programmable money.

The FX settlement provider has recognised that risks are higher for currencies outside its scope; finding a solution, particularly one that includes the renminbi, could be tough.

In 2016, China’s currency seemed on target for global reserve status. These days, the renminbi appears stuck in reverse, with Beijing looking on passively as its status shrinks and it slides down the global rankings.