The digital yuan will undergo an upgrade, with wallet balances accruing interest starting January 1, 2026. Without altering the two-tier operating structure, digital yuan held by banking institutions will move from off-balance-sheet to on-balance-sheet, changing from 100% reserves to partial reserves; non-bank payment institutions will implement a 100% digital yuan margin. Banks will pay interest on customers' registered digital yuan wallet balances, adhering to deposit interest rate pricing self-regulatory agreements, and can independently manage their digital yuan wallet balances, with deposit insurance providing the same security guarantees as deposits. For non-bank payment institutions, the digital yuan margin is no different from their customer reserve funds. (Caixin)