It mainly exists in the form of US Treasury bonds. It is neither a loan from the Bank of China nor an outstanding commodity payment, but the relevant foreign exchange administration departments in China purchase its publicly issued treasury bonds or assets in the market.

The whole process is like this: China enterprises sell their goods to the United States or other countries, and Americans (or businessmen from other countries) pay US dollars (because US dollars are the international settlement currency). In addition to importing or investing overseas, China enterprises can't directly use US dollars at home, so they have to find domestic foreign exchange management departments to exchange foreign exchange and change their US dollars into RMB. As a result, the State Administration of Foreign Exchange accumulated a lot of dollars, and used these dollars to buy US Treasury bonds, which eventually turned into money owed by the United States to China.