The main four banks of China, retailers, and entertainment stores participate in pilot tests of the digital asset.
According to local media reports, McDonald’s and Starbucks are on the list of the 19 companies to test the digital yuan, China’s famous Central Bank Digital Currency (CBDC). This initiative is part of a pilot project to be conducted in Xiong’An, in the province of Hebei, China.
In this way, these two large restaurant chains are part of a list of restaurants and retailers that will participate in the pilot tests. According to local media, other institutions that will test the token are Zhonghai SPV, Jinfeng Catering, Jiankun Catering, Kaili Hotel, Oscar Studios, Golden Baihe, and Cainiao Inn.
To discuss the launch of this pilot project, the Commission of Development and Reform of Xiong’An celebrated a meeting on April 22nd. In that meeting, in addition to the 19 restaurants, Chinese companies Ant Financial and Tencent, representatives of various government agencies, entertainment stores, retailers, and China’s four state commercial banks also participated.
These four government banks participating in the project are the Industrial and Commercial Bank of China (ICBC), the Agricultural Bank of China (ABC), the People’s Bank of China (PBoC), and the China Construction Bank.
The Time to Invest
Previously, China had used this token in Suzhou to finance travel, but now the use of this Chinese digital asset is targeting the region’s retail sector. There, this digital asset would function as part of a transportation subsidy scheme for local government and business workers.
Until now, local media reports that four Chinese cities were selected for the test. These cities are Shenzhen, Chengdu, Suzhou, and Xiong’an.
Despite the crisis that Covid-19 has generated, the Bank for International Settlements (BIS) indicated that this is the best time to launch the pilot project. This occurs because many citizens distrust fiat money, some of them have even wanted to save their US dollars in cryptocurrencies until the crisis ends.
Government Banks Prepare
In China, despite the government was critical of cryptocurrencies, government banks are now preparing for the adoption of the digital yuan. “The Central Bank has been preparing for launch both technologically and theoretically for a long time”, said Cao Yin, Deputy Director of the Tsinghua University Blockchain Research Institute.
Yin stressed that the People’s Bank of China (PBoC) has all the resources and talent necessary for the implementation of the use of digital yuan.
Also, the Agricultural Bank of China, one of the country’s largest commercial banks and owned by the Chinese government, began testing the digital currency. This is what the local media reported.
Token development progresses rapidly. Until now, the Agricultural Bank of China and the People’s Bank of China are working on a token wallet in the Chinese cities of Shenzhen, Suzhou, Xiong’an New Zone, and Chengdu. Additionally, Matthew Graham, CEO of the blockchain-focused fund Sino Global Capital, commented on Twitter, the beta application of this wallet is similar to WeChat Pay, Ant Financial (formerly Alipay), and the Tencent application.
The People’s Bank of China has been investigating digital yuan since 2014. This year, the project is making significant progress. However, the PBoC stressed that the launch of the pilot test “does not mean that the digital yuan has been officially launched”.
Until now, there is no official launch date, but some believe the digital asset would be ready in less than two years. The digital yuan could even be used at the 2022 Winter Olympics Games, which would mean the launch could occur in 2021.
By María Rodríguez
