14 Aug 2020 Jane Whitmoore
China Will Expand Digital Yuan`s Testing
The Chinese government announced a further expansion of its Digital Currency/Electronic Payment (DC/EP) system testing, as China’s Commerce Ministry said its pilot digital currency program is going to reach several large cities. The trials are in line with People’s Bank of China (PBoC)’s plans for a state-run, blockchain-based electronic payment system.
China’s Commerce Ministry clarified that the first major cities and provinces that will get access to the DC/EP system would be China’s capital Beijing, as well as the Tianjin and Hubei provinces. The list also includes the territory of the Yangtze River delta, the Guangdong province and the cities of Hong Kong and Macau.
Despite that there is still no strict timeline for the start of the test expansion, China’s Commerce Ministry noted that the design of the policies needed for the roll-out are expected to be ready until the end of 2020. PBoC already launched the pilot digital currency program in the cities of Chengdu, Suzhou, Shenzhen, and Xiong’an. The reasons behind the launch were reported to be partly related to the preparation work for the 2022 Beijing Winter Olympics.
If the DC/EP system is officially introduced, it will be the first digital currency, launched by a major national bank. PBoC stated that the new system would have similarities with the crypto leader Bitcoin and Facebook’s Libra stablecoin project. One of the major differences, according to China’s national bank, is that transactions speed will be much greater, which should encourage a wider adoption in China.
In Suzhou, for example, PBoC undertook a series of internal tests, where a group of citizens received a portion of their salaries in the new currency. Also, as Cryptobrowser.io reported, snapshots of what is supposed to be the wallet app of the DC/EP system were released earlier this year, circulating through the Internet. Interestingly, the snapshots revealed a variety of functionalities, including transaction tracking and linking wallets to existing bank accounts.
According to China’s national bank, the introduction of a transparent and efficient system would also help combat money laundering, gambling and financing terrorists` activities. Also, PBoC’s plans are to substitute China’s native fiat currency (cash in circulation), but without replacing other aspects of China’s monetary supply.
Large-scale businesses have already begun testing the new system, including Didi Chuxing Technology Co., which is one of China`s biggest logistics companies. Didi Chuxing Technology declared that they are testing the digital currency`s applicability onto their transportation platform.
Didi Chuxing entered into a partnership with PBoC’s Digital Currency Research Institute to research and conduct tests of DC/EP application, without disclosing any further information on their partnership terms.Bitcoin Cryptocurrency Crypto Market crypto money crypto market monitoring china cryptocurrencies test bank cryptocurrency news digital asset digital Government Banks Facebook Libra