Speculation has been mounting that the digital yuan will be used to displace the US dollar and circumvent sanctions. In retaliation, financial institutions can be targeted whereby US dollar payment or financial system access can be sanctioned. If the United States weaponizes the dollar, the digital yuan will not provide sanction protection beyond the status quo. The digital yuan’s true innovation is the ability to manage capital controls and facilitate financial liberalization. Being a programmable currency, the digital yuan enables Mainland China to open its economy more expeditiously than would normally be possible, while providing the regulatory levers to manage monetary and financial stability. Mainland technology companies are instrumental in the circulation of the digital yuan through electronic payment platforms. These same technology companies have recently established virtual banks and stored value facility payment platforms in Hong Kong. This chapter argues that technology is introducing new risks into Hong Kong’s banking system which pose a material risk to financial stability. To manage these risks, financial data supervision and infrastructure is required which currently does not exist. With the recent growth surge and volatility in cryptocurrency markets, the current approach of neglecting financial stability supervision is erroneous and reckless.

This chapter focuses firstly on the impacts of regulation on the prerequisites for AI, i.e. the regulation of data used to train, develop, improve, and control AI, and secondly on the use of AI with regard to certain data. It covers the regulatory aspects derived from data protection and privacy regulations. The chapter explains the implications of AI for data protection and vice versa, on the basis of what is currently the most comprehensive regulatory approach in data protection law, the EU GDPR, but also in the light of the EU Artificial Intelligence Act proposal. Parts of a future EU AI Regulation may overlap with the GDPR, even if the GDPR provisions will continue to apply and remain a guiding regulatory tool. The chapter explains why data protection law has any impact on AI at all and then presents an overview of selected data protection principles and provisions which must be adhered to in the particular context of AI.

The regulation of data has increasingly become a common feature of trade agreements. While all regulators would agree on the need to strike a balance between the clashing interests of different stakeholders, their approaches often differ in practice. The various regulatory approaches often reflect the different legal, political, economic, social and cultural backgrounds of different countries. Thereby, it is important to understand the inherent logic and mechanisms of the different regulatory regimes.

In this chapter, the focus lies on China, which is not only home to the largest e-commerce market in the world, but also has one of the most tightly regulated cyberspaces. By providing a detailed analysis of the rationale and operation of ‘data regulation with Chinese characteristics’, the chapter seeks not only to help understand this discrete regulatory model but also to find ways to deal with such a regime at the international level.