China’s central bank (CBDC) digital currency e-CNY would be integrated into the country’s largest messaging app. WeChat, which is said to start supporting the currency, has more than a billion users, meaning the initiative could significantly boost the promotion of the digital yuan to the public.
WeChat adopts digital payments
According to a recent report from CNBC, WeChat Pay, a versatile mobile messaging and payment app, is starting to support digital yuan payments. The move is expected to rapidly increase the number of citizens interacting with the e-CNY, as its messaging service has nearly 1.2 billion active users.
Alipay, WeChat’s main competitor in China, has also focused on digital yuan settlements. Last year, the company, led by Ant Group, a subsidiary of Alibaba, began testing to explore possible adoption.
Speaking on the matter, Linghao Bao, an analyst with consulting firm Trivium China, said Chinese consumers were so attached to the two companies that they couldn’t be convinced to switch to a new mobile payment app.
“It makes sense for the central bank to partner with WeChat Pay and Alipay rather than going it alone”, he concluded.
The potential expansion in the use of Chinese CBDCs comes weeks before the start of the Beijing Winter Olympics. Authorities had previously announced that they could allow athletes and foreign visitors to use the financial product at the sporting event.
The People’s Bank of China (BPC) has attempted to promote its central bank digital currency (CBDC) on numerous occasions in recent months. Following these efforts, last November, the institution informed that the number of people who opened digital wallets in yuan reached 140 million.
Earlier this week, the BPC Digital Currency Research Institute released the app “e-CNY (Pilot Version)”, a mobile wallet for using the Chinese CBDC, on app stores iOS and Android across the country. The development enabled local users to download it and pilot test the digital yuan and its circulation services.
The initiative was first available in Shanghai, then spread to other parts of the most populous country. The institute recalled that the most effective functionality is always in research and development. The “e-CNY (pilot version)” is only accessible to accredited users through institutions providing digital yuan services, such as major national banks.
After banning all cryptocurrency-related activities, China establishes the centralized crypto system. Launching the national CBDC in the territory of such a large country is an extremely difficult task, but the government of the country is moving step by step in order to implement and, above all, promote its product, making it accessible to all the population. While waiting for the official launch during the Beijing Olympic Games, we suggest that you stay on Cointribune in order to be up to date!
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