How Would Digital Yuan Change China’s Economy? Description video: Jul.27 — Jennifer Zhu Scott, founder and partner of investment firm Radian Partners, talks about the potential of a digital currency developed by China’s central bank and the virtual legal tender […]
How Would Digital Yuan Change China’s Economy?
Jul.27 — Jennifer Zhu Scott, founder and partner of investment firm Radian Partners, talks about the potential of a digital currency developed by China’s central bank and the virtual legal tender dubbed Digital Currency Electronic Payment or DCEP. The People’s Bank of China is planning to test its digital currency on platforms operated by Meituan Dianping, enlisting the food delivery giant backed by Tencent Holdings Ltd. in a major step toward the token’s mass adoption. Zhu Scott speaks with Rishaad Salamat and Juliette Saly on \”Bloomberg Markets: Asia.\”
China to distribute digital yuan worth $ 1.5 billion as part of testing
China kicks off one of the biggest real-world tests of its digital currency, moving closer to creating a cashless future.
Last week, the Shenzhen government held a digital currency lottery totaling 10 million yuan (about $ 1.5 million). Almost 2 million people submitted applications, and 50 thousand participants of the drawing won.
Winners can now download the app to receive the digital yuan and spend it with over 3,000 merchants in a designated area of Shenzhen. The South China Technology Center is home to some of the country’s largest tech giants, including Huawei and Tencent..
The participating sellers include Walmart, as well as local supermarkets and pharmacies, according to the Shenzhen government’s WeChat app..
The digital yuan is not a bitcoin-like cryptocurrency. It is issued and controlled by the People’s Bank of China, the country’s central bank. The digital yuan does not intend to replace digital wallets like Alipay or WeChat Pay. Most likely, he will work with them and other banks.
Unlike the digital yuan, bitcoin is decentralized, which means that it is not owned by any individual or controlled by central banks..
China’s digital yuan has been under development for the past few years, with only a few small trials conducted across the country. Pilot project from Shenzhen seems to be the largest of the tests so far.
Central banks around the world are exploring the idea of issuing digital currencies. Last week, the Bank for International Settlements and the world’s seven central banks released a concept for central bank digital currencies dubbed CBDC.