**China Expands Digital Yuan System with Addition of 12 Commercial Banks** China's central bank-backed digital currency, the e-CNY, is set to gain further traction as Beijing includes 12 more commercial banks in its digital yuan system. This move marks a significant step towards scaling up adoption of the digital yuan, as the country transitions from a cash alternative to an interest-bearing deposit instrument. The expansion of the digital yuan system comes after Beijing pledged to "steadily develop the digital yuan" in its latest five-year plan. The country's blueprint document for socio-economic development outlines the government's vision for the digital currency's growth. A draft Finance Law published on Friday recognized the digital currency as a fiat currency equivalent to cash, while a new framework supporting the wider campaign took effect in January. The 12 additional banks will undertake key functions such as opening wallets, currency exchange, and payment processing. This development follows a procurement statement issued by the Bank of Ningbo on Tuesday, soliciting vendors with e-CNY experience as it builds out its infrastructure for the digital currency. The new additions will bring the total number of banks integrated into the digital yuan network to 22. The new banks include seven national joint-stock commercial banks: China Citic Bank, China Everbright Bank, Huaxia Bank, China Minsheng Bank, China Guangfa Bank, SPD Bank, and Zheshang Bank. Additionally, five city commercial banks – including the Bank of Ningbo – will also be added to the network. Currently, only 10 banks – including China's six major state-owned banks – are integrated into the digital yuan network. Under the central bank's supervision, the commercial banks will be responsible for the e-CNY's day-to-day operations, as well as compliance checks related to areas such as anti-money laundering and identity verification. This move is part of China's broader efforts to increase the adoption and usage of the digital yuan, which is seen as a key component of the country's financial infrastructure.