How did the outflow of silver affect China’s economy?

The Chinese economy was historically based on a bimetallic monetary system, where copper cash was used for daily transactions and silver was utilized for large business dealings and tax payments. The exchange ratio between these two metals was highly responsive to supply fluctuations, meaning that changes in the availability of silver directly impacted all citizens.12

As the opium trade expanded in the 18th and 19th centuries, the massive outflow of silver used to pay for the drug caused a significant drain on the Chinese economy. This depletion of silver led to a fall in the value of copper within the bimetallic system. Because taxes were collected in silver, the rising cost of silver relative to copper effectively increased the tax burden on the population, creating widespread economic disruption. Furthermore, the trade fostered corruption among officials and soldiers, further destabilizing the social and economic order of the Qing dynasty.321