The digital currency of China to be utilised for small-scale transactions

By: Ben Gabriel
Ben Gabriel
Ben is a cryptocurrency journalist, simple. He's also a technology and cryptocurrency geek having enjoyed immersing himself in the… read more.
on Aug 31, 2020
  • The hype regarding China’s digital currency continues to mount as the first trial undergoes.
  • The digital currency is limited to smaller transactions and it is launched in specific cities.
  • Digital currency can also be exchanged with the banknotes at the rate of 1:1.

Undoubtedly, China is among the leading countries in terms of technology. Lately, China has been in the news for its digital currency. After the cryptocurrency ban, China is keen on developing its currency to join the race of central bank digital currencies (CBDCs).

According to the People’s Bank of China (PBoC), digital yuan can only be used for small transactions. Perhaps it will expand to larger retail transactions in the future. 

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However, the People’s Bank of China (PBoC) made this announcement to debunk pointless rumors concerning the digital currency being used for big-scale transactions. Wang Peng, a Chinese assistant professor of the Gaoling School of Artificial Intelligence at Renmin University was accused of using the digital currency for a massive real estate deal.

Wang Peng said:

“At its current stage, the test’s primary goal is to ensure the digital currency’s operation runs smoothly and safe, and to determine how DCEP is distributed from the central bank to financial institutions. Only when trials in retailing are successful will they be carried out in large transaction scenarios.”

China’s plan towards expansion

Despite the conflicts with the United States, China is determined to accelerate the production of Digital Currency Electronic Payment (DCEP). Though, China’s effort to win the global race of central bank digital currencies (CBDCs) is in the trial phase. The experts and developers behind the DCEP initiative tend to achieve the first milestone with the outcome of the trial.

For now, the trials are taking place in Shenzhen; Suzhou in Jiangsu Province; Chengdu, the capital of Sichuan Province; and the Xiongan New Area in Hebei Province. Most likely, Chinese authorities will expand digital currency trial to other cities as well.

In early August, the Beijing News (Chinese media outlet) reported that the central bank digital currency team based in Shenzhen has been subsequently hiring new staff. The job postings were about research engineers and blockchain developers.

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