Details regarding the digital yuan's characteristics are taking shape.
The forthcoming digital yuan will reportedly be compatible with major payment networks within the country.
Mu Changchun, the head of the People's Bank of China's digital currency research institute, said that the central bank-backed digital yuan will be compatible with major mobile payment wallets like WeChat Pay and Alipay.
According to a report from South China Morning Post, Mu said during a conference that the digital yuan will not compete with WeChat Pay and Alipay:
"They don’t belong to the same dimension. WeChat and Alipay are wallets, while the digital yuan is the money in the wallet."
These recent statements would appear to contradict earlier reports from local sources suggesting that China may launch its digital currency as an alternative to the two payment giants.
The digital yuan is currently accessible to limited users through an exclusive mobile wallet application. At the conference, Mu said that the mobile wallets for digital yuan face the age-old problem of counterfeiting, stating that there were multiple fake digital yuan wallets in the market.
Mu said it would only be possible to reduce the impact of counterfeit wallets if all parties involved, from the central bank to the users, take necessary cautions.
On a different note, Mu said that the digital yuan operates on a centralized infrastructure, differentiating it from private currencies like Facebook's Libra and Bitcoin (BTC).
China has progressed rapidly with its central bank digital currency initiative. Last week, it published a draft law to provide a regulatory framework and legitimacy for its digital yuan. At present, the central bank is conducting pilot tests across the country for its CBDC.
In one of the largest pilot tests, local authorities distributed $1.5 million worth of digital yuan to 50,000 of the 1.9 million people who signed up for a giveaway.
Original title: Digital yuan will work with WeChat and Alipay, says bank exec
The views expressed in this article are the author's own and do not necessarily reflect the view of Amber Group. Amber Group shall not be held liable under any circumstances for any losses, damages or expenses arising from the use of any content mentioned in this article.
The information contained on this website is provided for informational purposes only, with no warranties, or guarantees made as to the accuracy, completeness or timeliness of it. Amber Group assumes no liability or responsibility for any errors or omissions in the information contained on this site. We strongly encourage you to conduct your own research before taking any action.
This site may contain copyrighted material, the use of which has not always been specifically authorized by the copyright owner. If you wish to use the copyrighted material from this site for the purposes of your own that go beyond 'fair use', you must obtain permission from the copyright owner. Authors or publishers who claim ownership of copyrighted articles reprinted on this website and wish for the content to be removed may email us directly at firstname.lastname@example.org
If you would like to connect with us about any of the distributed content or other inquiries, please email us at email@example.com with the relevant documentation.