In a significant boost to the development of its digital currency, China's central bank has launched a pilot version of its wallet app, which hopes to promote the use of the digital Yuan among more people. The wallet is available on the Chinese Android App Store and also on the Apple App Store.
The Chinese digital yuan
The e-CNY or digital Yuan is exactly what the name suggests, a digital version of the Chinese Yuan. It has been in development since 2014, and unlike cryptocurrencies like Bitcoin, it will be controlled and issued by the People's Bank of China.
China conducted several trials in the country, where city users were given a certain amount of digital currency to spend. Major China-based retailers, such as JD.com, a major e-commerce company, also accepted CBDC as payment during the previous year.
The official launch is still far away
While the Digital Yuan has been in development for a considerable time, there is no clear timeline for its launch, which means that the official launch of the Digital Yuan is still a long way off.
For now, the wallet Digital Yuan Pay App allows users of major cities like Beijing and Shanghai to use it. Initially, the application was available by invitation only, but has recently been made available to all for download, highlighting Beijing's renewed push in the development of its CBDC.
Trial of the Winter Olympics
The digital yuan will be featured in the Beijing Winter Olympics area. The app specifically lists this detail, with the Winter Olympics taking place in the Chinese capital. The People's Bank of China has pushed for the Digital Yuan to be at the fore during the Winter Olympics. However, the digital wallet faces significant competition from the payment applications that dominate the Chinese market, namely Ant Group's Alipay and Tencent's WeChat.
China's CBDC has little in common with cryptocurrencies
According to Martin Chorzempa of the Peterson Institute of International Economics, China's digital Yuan is very different from cryptocurrencies such as Bitcoin and Ethereum. He called CBDC much safer than cryptocurrencies due to their stability, unlike cryptocurrencies which are highly volatile.
“I would say the security levels (of the digital yuan) are very high, and the risk is low,” he said. "It is designed to be the same value as any regular renminbi, so there should be no price fluctuations to worry about."
The pilot run produces transactions worth $ 5,34 billion
The People's Bank of China revealed some jaw-dropping numbers from its digital Yuan pilot run, showing transactions worth 34,5 billion Yuan or $ 5,34 billion as of June 2021. The central bank said the CBDC is been used for over 70 million payments in more than 1,3 million scenarios, showing the immense reach of the digital Yuan.