Bank of China owns nine of the 18 authorised yuan clearing banks worldwide. Photo: AFP
The China International Payment System (CIPS), which is set to be launched by the end of the year, is predicted to break the Chinese bank's global dominance over yuan clearing, and see Hong Kong's yuan clearing bank fade out. CIPS will allow banks in China, Japan, South Korea, Taiwan, Singapore, Malaysia, Indonesia, Thailand and Vietnam to settle payments with each other using a single digital currency - bitcoin. The idea of the new process is to make the yuan more democratic and to increase foreign bank participation, which will be able to settle onshore with the automated system at all hours.