China Builds Its Own Energy-Digital System: e‑CNY, mBridge, Gold, and Bitcoin | SforNews

CHINA — THE COMPETITOR BUILDING ITS OWN SYSTEM
Diagnosis of the Old Model and Its Place in the New EnergyDigital System

DISCLAIMER

This material is an analytical study prepared by the editorial board of the journals Kafedra and SforNews as part of a series of works on the transformation of the global energy and financial architecture. The material is based on open data, official documents, public statements, and analytical reports from independent experts.

The material does not constitute legal advice, investment recommendations, or a call to action. The authors do not provide advice on the purchase, sale, or storage of any assets, including cryptocurrencies. All conclusions are probabilistic and analytical in nature. The editors bear no responsibility for any financial or legal decisions made based on the content read.

ABOUT THE SERIES

This article continues a series of publications devoted to analysing the readiness of various countries and regions for the transition to a new energydigital system. The series serves as an evidence base for the Memorandum “Architecture of the New EnergyDigital System” and is intended to clearly demonstrate:

Each article in the series provides an architectural diagnosis of a specific country or region in terms of its readiness for the global transition.

Previous article in the series: “Europe — the Eternal Importer of Bitcoin”.

INTRODUCTION: A BRIEF DIAGNOSIS

China is the only country in the world that is simultaneously building all three circuits of the new system: energy (coal + nuclear + renewables), digital (eCNY + mBridge), and reserve (gold) [9][10][12][16]. Unlike Europe, which shut down its nuclear plants and lost sovereignty, China does not make ideological mistakes. Unlike the United States, which is losing control over global liquidity, China is creating a parallel payment infrastructure [5][6].

China’s paradox: it has officially banned bitcoin mining, yet its hash rate unofficially ranks third in the world — 11.7% of the global hash rate [1][2][3]. It is building a digital yuan, yet at the same time it has been buying gold for 20 consecutive months [12][14]. It declares a “green transition,” yet coal still accounts for more than 50% of its electricity generation [7][8].

China is not joining the new system — it is building its own system. And that makes it the main competitor in the global transition.

SECTION 1. THE OLD MODEL: WHAT WAS AND WHAT BROKE

China’s growth model over the past 40 years rested on three pillars:

This model no longer works.

Growth is slowing. In 2025, GDP grew by 5% [19]; in 2026, the target is 4.5–5%. But analysts speak of real deceleration.

Population is shrinking. In 2025, the population decreased by 3.39 million people [16]. In 2026, the decline is expected to continue — around 3.2 million. The workingage population peaked 15 years ago. By 2040, China could lose up to 60 million people [18].

Debt burden is rising. The budget deficit in 2026 is estimated at 4% of GDP — 5.89 trillion yuan ($825 billion) [20]. Government debt is projected to reach 96% of GDP by 2027 and 101% by 2028 [20].

Deflationary pressure. The inflation target is 2%, but consumer prices in 2025 remained flat [19]. Deflation is no less frightening an enemy than inflation.

The map (export growth, investment boom, demographic potential) has ceased to reflect the territory (aging population, debt pit, deceleration).

SECTION 2. ENERGY PROFILE: WHAT EXISTS, WHAT DOES NOT

China is the world’s largest energy player. In 2026, its energy investments will reach $940 billion — nearly onethird of all global energy investment [10].

What exists	What does not
Vast coal capacity (over 50% of generation) [8]	Cheap gas (dependent on imports through vulnerable routes)
Global leader in renewables (solar + wind) [8]	Sufficient grids to transmit power from “megabases” of renewables [7]
Active construction of nuclear power plants [9]	Flexible power system (renewable curtailment — 8–9%) [7]
World’s largest coal producer and consumer [11]	Energy sovereignty (dependent on oil imports through the Strait of Hormuz)

Key fact: China does not repeat Europe’s mistake. It is not shutting down nuclear power and does not abandon coal for ideology. It is building all sources simultaneously.

But there are also problems. Due to weak grids, China loses as much “green” energy as France consumes. In early 2026, forced curtailment of renewable generation reached 9.2% for solar and 8.5% for wind [7].

Bottom line: China has a colossal energy surplus, but cannot use it efficiently domestically. This surplus will be monetised through exports — including via digital channels.

SECTION 3. POSITION ON MINING AND CRYPTOCURRENCIES

Here lies China’s main contradiction.

Official position: outright ban. In February 2026, Chinese regulators confirmed that any activity with digital currencies (bitcoin, Ethereum, USDT) on Chinese territory is illegal [20].

Actual situation: mining has returned. According to Hashrate Index, in Q1 2026 China’s share of the global bitcoin hash rate was 11.7%, or about 125 EH/s [1][2][3]. The US ranks first (37.5%, ~400 EH/s), Russia second (16.4%, ~175 EH/s) [2]. How is this possible under an official ban?

However, the trend is tightening. In 2026:

China’s paradox: it bans mining, yet its hash rate remains significant. It pushes miners abroad, but indirectly supports them through cheap energy. This is not politics. This is physics: excess energy must go somewhere.

SECTION 4. POSITION OF THE CENTRAL BANK (PBOC)

The People’s Bank of China is the most pragmatic central bank in the world. It does not try to “save” the old system. It is building a new one.

Instruments:

Why is the rate not being cut? Not because of a lack of liquidity, but because of lack of credit demand. The main problem is the real estate crisis and falling consumer confidence [23]. This is a fundamentally different diagnosis than in Russia or Europe.

New element: the digital yuan (eCNY) as a weapon.

Three key events occurred in 2026:

mBridge is the key to understanding China’s strategy.

This is a multilateral platform for settlements in central bank digital currencies (CBDCs), created jointly with Hong Kong, Thailand, the UAE, and Saudi Arabia [4][5][6].

The numbers speak for themselves:

What does this mean?

mBridge allows crossborder payments in seconds, bypassing SWIFT and intermediary banks [5]. Fees are roughly half of standard international payments [5]. It is not a “dollar replacement” (China understands this is impossible in the foreseeable future), but a parallel infrastructure that gradually erodes the dollar monopoly.

PBOC’s paradox: it is building the digital yuan as an alternative to the dollar, yet at the same time it buys gold — the oldest reserve asset.

Gold: China has been buying gold for the 20th consecutive month [12][13]. In June 2026, it purchased 15 tonnes — the largest monthly purchase since October 2023 [13]. Official reserves stand at 2,346 tonnes (9.6% of total foreign exchange reserves) [15]. But Goldman Sachs estimates that actual purchases could be significantly higher — up to 48 tonnes per month through the overthecounter market [14].

Bottom line: The PBOC acts as an architect, not a regulator. It does not try to “cure” the old system — it is building a new, parallel one. The digital yuan for settlements, gold for reserves, and (implicitly) bitcoin for monetising surplus energy.

SECTION 5. ARCHITECTURAL CONCLUSION: WHAT PATH IS AVAILABLE TO CHINA

China is the only country that simultaneously:

Unlike Europe, China has not made an ideological mistake. It has not shut down nuclear. It has not abandoned coal. It has not signed up to the Western ESG diktat. It is building a pragmatic, multilayered system.

Unlike the United States, China is not trying to “save” the dollar. It is creating a parallel infrastructure that gradually erodes the dollar monopoly [5][6].

Unlike Russia, China has a strategy. It has no gap between map and territory — it builds the territory in accordance with the map.

But there are also weaknesses:

Main conclusion:

China will not “import bitcoin” like Europe. It has its own energy, its own digital currency, and its own reserves. But it will use bitcoin as a tool — to monetise surplus energy, to circumvent sanctions (through third countries), and to diversify reserves.

For China, bitcoin is not “digital gold” and not an “energy coupon.” It is a tactical instrument in a larger strategic game. China is not betting on bitcoin — it is betting on its own system. But in that system, there is room for everything: coal, nuclear, solar, wind, digital yuan, gold, and — yes — bitcoin.

The question is not whether China will use bitcoin. The question is how it will fit it into its architecture.

CONCLUSION: HOW CHINA FITS INTO THE GLOBAL TRANSITION

China is neither a victim of the transition nor its beneficiary. China is an architect of its own system, which will compete with the global one.

Europe will become an eternal importer of bitcoin — because it has no energy.

Russia could become an energy sovereign — but it has no strategy.

China is building everything at once: energy, digital, reserves. And that is its strength.

Global implication: China shows that the new system will not be monolithic. There will be several systems — American (dollar + Treasuries), Chinese (eCNY + mBridge + gold), European (importing bitcoin), Russian (exporting energy through bitcoin). The question is which system will prevail. Or they will coexist — just as the dollar, euro, and yuan coexist today.

China is betting on parallel infrastructure. And it has all the resources to build it.

LIST OF SOURCES

NEXT ARTICLE IN THE SERIES: «The United States — Losing Control Over Global Liquidity: Dollar, Treasuries, and Bitcoin as a Challenge».

© 2026, editorial board of Kafedra and SforNews.
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