China’s testing of its digital yuan is set to continue, with the country’s central bank selecting Beijing as the next testing ground. The People’s Bank of China will conduct the biggest pilot yet in the country’s capital, testing its digital currency electronic payment (DCEP).
The PBoC has been testing the DCEP for several months now as it readies itself for the public launch of the digital currency. It has conducted pilot tests in China’s largest city Shanghai, the tech city of Shenzhen and the southern city of Guangzhou. The latest test was in Shenzhen where the government gave away $1.5 million worth of digital yuan to boost adoption.
Beijing is the next city on the PBoC’s test journey, local digital currency news outlet 8btc has revealed. The PBoC’s Digital Currency Research Institute recently announced that it was planning to build a ‘legal digital currency test zone’ in Beijing, the report states. The Institute made the announcement following a meeting on Monday between the Beijing Local Financial Supervision and Administration and the Tongzhou District government.
While the Institute withheld details regarding what the test zone will entail, local reports indicate that it will be the biggest one yet.
The meeting between the two government entities is believed to have been geared towards developing Beijing’s financial and technology industries. This, as 8btc notes, will further boost the uptake of the digital yuan. As per the outlet, some of the key areas of focus will be payment clearance, asset transactions, credit rating and data management—all of which will utilize blockchain technology and the digital yuan.
According to PBoC governor Yi Gang, over 4 million transactions have been made using the digital yuan, amounting to over $300 million. Of these, over 3.1 million occurred during the $1.5 million ‘red packet’ giveaway in Luohu district, Shenzhen. With Beijing being China’s administrative capital and one of the country’s largest cities, the uptake and number of transactions could be bigger.
For its part, Beijing has been growing in profile as a blockchain and digital currency hub in China. In September, it was named the top blockchain city in the Chinese Blockchain Innovation rankings. The city also released its first-ever blockchain blueprint in July, revealing that it intends on using the technology to digitalize its economy.
To learn more about central bank digital currencies and some of the design decisions that need to be considered when creating and launching it, read nChain’s CBDC playbook.
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