September 28, 2022

China will begin the test of national cryptocurrency in the framework of 7 companies

China will begin the test of national cryptocurrency in the framework of 7 companies

People's Bank of China Intends to Test Digital Currency (DC / EP) Electronic Payment System Shenzhen and Suzhou, writes The Block, citing local financial publication Caijing.

According to the publication, the Central Bank entered into cooperationwith seven state-controlled companies: four commercial banks and three telecommunications giants. Their resources are planned to be used during the upcoming testing.

Earlier, the head of the payment and settlement divisionAccording to the decisions of the central bank, Mu Changchun stated that the regulator intends to create competition between the companies, like “horse racing”, in order to achieve maximum quality while creating the necessary infrastructure. This is also stated in the latest publication.

The pilot program will focus on suchindustries like transportation, education, commerce and healthcare. Some banks decided to work with telecom operators to develop SIM cards with integrated digital wallets; others will create wallets on their own.

Testing in Shenzhen will be conducted in two stages. After a period of small-scale trials at the end of this year, authorities will be promoting DC / EP in the region throughout 2020.

As Caijing notes, to action onThe launch of the national digital currency, which has been under development since 2014, was launched by the People’s Bank of China after the announcement of the Facebook cryptocurrency initiative this summer.

“Previously, the central bank did not rush this. Recently and quite suddenly, they accelerated. ”- said in a conversation with the publication, representatives of several commercial banks.

According to the current model, commercial banksthey will be the first to receive digital currency from the regulator, providing in exchange their reserves in fiat currency. Users and business representatives will be able to register wallets in these banks and use them to interact with digital currency.

Earlier, the EU authorities announced their intention to explore the possibility of launching a single digital currency, although they, unlike the Central Bank of China, are not ready to proceed with active measures.