Bitcoin, Blockchain & Cryptocurrency News

Categories: Regulation

China: State Commercial Banks Trial Digital Wallet for CBDC

China’s central bank digital currency could be inching closer to its official launch, as some top state-run commercial banks in the country are reportedly trialing a digital wallet for the national digital currency.

Digital Wallet App Used for Payments and Transfer

According to Reuters on Thursday (August 6, 2020), the banks are involved in large-scale internal testing of the app for China’s planned digital currency electronic payment or DCEP. The trial has seen staffs of these local banks in different cities use the digital wallet app for making payments and transferring funds.

As reported by BTCManager back in April, the Agricultural Bank of China (ABC) launched a mobile application for the trial of the CBDC project. The testing was said to be conducted by whitelisted citizens in four cities including Shenzhen, Xiong’An, Chengdu, and Suzhou. Other companies such as Starbucks, McDonald’s, Didi, and Meituan Dianping are participating in the DCEP trial.

The latest testing of China’s CBDC reflects the country’s progressive digital yuan efforts. While the CBDC bandwagon continues to see more entrants, the People’s Bank of China (PBoC) maintains the lead.

Earlier reports revealed that China was looking to accelerate its CBDC plans because of the economic friction between the country and the United States. Another reason was to make the national digital currency available for the COVID-19 stimulus payment.

Also, Beijing reportedly has plans to push its CBDC for cross-border transactions. The increased use of the yuan for international settlements could challenge the U.S. dollar hegemony.

China CBDC Looking to Gain Foothold in the Digital Payment Sector

Apart from testing the DCEP with major businesses, cities, and institutions, the government is reportedly looking to reduce the dominance of the digital payment market by the private sector. According to a recent report by BTCManager, Tencent’s Wechat Pay and Alibaba’s Alipay controlled the country’s electronic payment industry.

However, the government’s national digital currency could eat into the private sectors’ dominance and also level the playing field for commercial banks. In addition, there are plans by the PBoC to develop a universal barcode to make the QR code payment system easier. The planned universal barcode could threaten Alibaba’s and Tencent’s market dominance.

While the Chinese government has no affinity for the cryptocurrency sector, the country is keen on being a blockchain leader and promoting the adoption of the technology. Blockchain Services Network (BSN) which launched in April 2020, integrated six leading public blockchains including Ethereum and Tezos.

Published by
Anthonia Isichei

Recent Posts

South Africa: Standard Bank Taps Contour Blockchain Finance Network to Issue Letter of Credit

Major South African bank joins the Contour blockchain trade finance network. Standard Bank Joins Contour…

8 hours ago

Bithumb Crypto Exchange May Be Up for Sale at $430M

South Korean crypto exchange behemoth Bithumb may be put up for sale once again as…

9 hours ago

OCC Authorizes U.S. Banks to Hold Stablecoin Reserves

The U.S. banking regulator has issued guidelines that will enable banks to offer services to…

11 hours ago

Report: Institutional Investors Plan to Accumulate More Cryptocurrency Assets

Institutional investors do not seem to be backing down from cryptocurrency yet, as many of…

12 hours ago

JD.com Joins Hands With China’s Central Bank for Digital Yuan Project

According to a media report last September 21, the e-commerce giant JD.com has joined hands with…

13 hours ago

Australia’s Agricultural Supply Chain Platform Adopts Hedera Hashgraph

Entrust, an Australian agricultural supply chain platform has adopted Hedera Hashgraph for agricultural products supply…

14 hours ago

This website uses cookies.