What Does McDonald’s, Starbucks and Subway Have In Common? Digital Currency Trials In China
According to Chinese pro-government media, three American companies are among the few businesses to participate in a new pilot program for China’s future digital yuan, thereby helping the world’s second largest economy push forward its plans to create an e-currency..
In the past few years, the People’s Bank of China has been developing a digital currency. Although very few details are known about its exact design at the moment, it is unlikely that it will bear any resemblance to the popular cryptocurrency Bitcoin, which supports anonymity and decentralization, that is, it is not issued by a central authority..
China’s digital yuan will be issued by the country’s central bank and appears to focus on making digital payments easier and faster.
McDonald&# 39; s, Starbucks and Subway are three American companies from 19 enterprises that will participate in the digital currency test in Xiong’an (Xiong’an), where the administration ran a promotion on Wednesday, according to the Securities Times.
Xiong’an is a special area 86 miles southwest of Beijing in Hebei province and a personal project of Chinese President Xi Jinping to build a new economic center.
In his Thursday speech, Xi Jinping emphasized that the country is stepping up the development of 5G, artificial intelligence and other technologies on a massive scale known as the project «new infrastructure».
The announcement of this pilot program, which appears to focus on retail and catering, follows another recent test in Suzhou, where the digital yuan was used to provide transportation subsidies to local workers..
Information Agency «Xinhua» announced in a post on April 17 that further testing will be carried out in Shenzhen and Chengdu ahead of the Beijing 2022 Winter Olympics.
Thus, the central bank made it clear that the digital currency has not yet been officially launched..
Earlier this month, a screenshot was shared on social media showing a new app from the Agricultural Bank of China that will allow users to use the digital yuan..
The topic of digital currencies issued by central banks has been gaining traction lately. Monetary authorities are seeking to innovate amid competition from China and Facebook’s digital currency called «libra», which has faced a number of problems since it became publicly available. Other central banks around the world, including the UK and Japan, are currently evaluating what their own digital currencies might look like..
But China seems to be ahead of everyone else. According to some experts, one of the potential benefits of the digital renminbi is that it can help internationalize the renminbi. In this regard, calls for the Fed to accelerate the development of the digital dollar are increasingly beginning to sound in the United States..