- Top Chinese banks, MYBank and WeBank are reportedly best to participate in the ongoing trial of the digital yuan.
- The Banks are owned by corporate giants, ANT Group and Tencent.
- China has been trying to stifle the powers of commercial payment companies like Alipay and WeChat Pay.
- Upon launch, the digital Yuan will be the first digital country owned by a large company.
China, the world’s most populated country is experimenting with a digital version of its currency. The project in its infancy sees banks that are backed by
Tencent and ANT Group participate in the trial of the digital yuan.
The banks involved are MYBAnk and WeBank. The inclusion of these corporate banks is meant to stifle the growing influence of corporations like Alibaba.
MYBank and WeBank Joins China’s Digital Yuan Experiment
As China prepares to unveil a digital version of its currency, Fintech Giants ANT says MYBank is one of the few selected private banks that will be participating in the digital currency experiment.
The spokesperson of the bank said, “the bank plans to advance the trial pursuant to the overall arrangements of the People’s Bank of China (PBOC).
Meanwhile, WeBank, backed by financial giants Tencent Holdings has been named in a February 20th report as part of private banks to participate in the digital yuan trial.
E-Wallets from the two privately owned banks will share strict similarities with the 6 government banks also taking part in the experiments. Top analysts claim that the launching of the digital yuan will make China the first country to floats its own digital currency.
The launching of the currency will provide stiff competition with payment corporations like Alipay and WeChat Pay. The trial process, according to Chinese citizens, feels like a lottery with a few randomly chosen citizens given tokens to spend in selected stores.
On The Flipside
- Chinese cryptocurrency mining industry is the largest in the world, accounting for over 50% of the world’s hash rate for Bitcoin.
- A valuable Bitcoin may overtake a weakening dollar as the world’s reserve currency, according to Bitcoin supporters.
China’s Digital Yuan
China looks set to be the first country in the world to float in the first digital version of its currency. The project already in the pipeline looks set to launch later in 2022 is already in its advanced stages.
The digital yuan has undergone several trials with the latest involving private banks like MYBank and WeBank and has involved digital red packets containing 200 yuan ($31) to random citizens to be spent in selected stores in China.
The Digital Yuan is different from cryptocurrencies like Bitcoin and Ethereum in the sense that it is fairly stable and not prone to the high-value volatility of cryptos. While the digital yuan is centralized and controlled by the People Bank of China (PBOC), crypto-currencies are largely decentralized without interference from intermediaries, third parties, or central banks.
Analysts have argued that before the digital yuan challenges the dollar, it should first face the stuff challenge posed by Alipay and WeChat Pay.