Didi Chuxing-what many consider China’s Uber to be conducting a test on the digital Yuan. As per Wednesday’s announcement, Didi joined the list of companies and banks to test China’s digital yuan developed by the People’s Bank of China (PBOC). The new electronic exchange medium will be known as the Digital Currency Electronic Payment (DCEP).
The ride-sharing giant features at least 550 million users and appears to be an appropriate platform to test the China’s digital yuan as a form of digital cash payment. This comes just a few days ahead of an expert analysis citing that the China’s Digital Yuan was only here to compete with the US dollar, not Bitcoin.
China Digital Renminbi, The First Mover of Stablecoin Space
Researchers at the Bank of America, have stated that China is the first mover in the CBDC area; and have recognized the digital renminbi as a welcome asset for regional trading partners. This, the analysts claim, is on the belief that payments are becoming more electronic and cashless. Thus, making the China’s a candidate that would most likely disrupt the US dollar.
Nevertheless, ahead of the first real-world trial of the China’s digital yuan, the Chinese Central Bank had initially launched mini-trials across four Chinese cities. The tests were carried out through various partnerships between the Central Bank, Starbucks, McDonald’s and Subway. These tests were the first phase of the trial, and the nation is now preparing to enter the next phase.
According to the People’s Bank of China Strategy and the timeline for the DCEP (Digital Currency Electronic Payment), Didi Chuxing and the Central Bank Task Force will be strategizing, designing and piloting the payment system with strict safety, governance, regulation and security precautions.
However, PBoC focuses on testing the digital stable coin as a native token on the Ride-Sharing application. It seems that the successful DiDi real-world test will lead to the final launch of the DCEP system. In fact, an official at the People’s Bank of China suggested plans to have a China’s digital yuan in use during the Beijing Olympics in 2022.