Sirlibz
Mu Changchun, the head of the People’s Bank of China’s digital currency research institute stated that the forthcoming digital yuan will be able to work with major mobile payments platforms or wallets life WeChat pay and Alipay. According to a report by South China Morning Post (SCMP), China’s digital currency is not built to compete with these other major payment wallets but rather would work together to grow each other in different ways possible.
“They don’t belong to the same dimension. WeChat and Alipay are wallets, while the digital yuan is the money in the wallet,” said Mu Changchun, the head of the research institute for digital currency at the People’s Bank of China. He spoke in Shanghai at the 2nd Bund Summit, co-organised by the China Finance 40 Forum.
Access to the digital yuan is through an app that some customers may choose to use instead of private mobile wallets. Wang Leilei also disclosed that participants interested in the pilot run in Shenzhen earlier this month were asked to download a specific app for the Digital Currency Electronic Payment (DCEP).
“If the digital money is to be allocated through the app, some people may switch to the app, while others may transfer it to WeChat or Alipay. It depends on consumers and the use case,” Wang said.
Mu Changchun also stated that they still had to deal with a major age-old problem similar to physical cash, and that is counterfeiting. He revealed that they have seen counterfeit digital yuan wallets on the market although he didn’t go in details.
Currently, the bank is running it’s first DCEP trials and is conducting this with institutions and various merchants in China’s Southern tech hub of Shenzhen. They also recently gave out 10million yuan worth $1.5million recently receiving through the lottery to over 47,500 people. It was awarded in the form of “red packets” with each containing 200 yuan. Individuals who got this yuan could actually spend this in the approved designated shops. Over 1.9milliom reportedly signed up in order to take part in the giveaway.
The DCEP operates in two phases. The first involves the issuing of the digital yuan done by the Central Bank, the second involves the designated institutions such as commercial banks, which is distributing the currency to users.
