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Explainer | China digital currency: when will the e-yuan be launched, and what will it be used for?
- China began exploring the concept of a sovereign digital currency in 2014 following the success of e-commerce platforms Alibaba, Tencent and Baidu
- China has already distributed some 200 million yuan (US$30.7 million) in digital currency as part of pilot projects across the country
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When will China’s sovereign digital currency be launched?
China has not announced an official timetable for the official launch of its Digital Currency Electronic Payment (DCEP) system.
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The first glimpse of the planned digital currency emerged in April 2020 when a screenshot of a test version developed by the Agricultural Bank of China was leaked.
Trials of the digital yuan began in May 2020 in four cities – Shenzhen, Suzhou, Chengdu and the Xiongan zone near Beijing.
Foreign consumer brands, including US chains Starbucks, McDonald’s and Subway, were named by the People’s Bank of China (PBOC) as participants in the initial pilot programme, along with Ant Financial, Tencent and 19 local restaurants and retail shops.
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Under the trial, Communist Party members were allowed to pay their membership fees in digital yuan with one unnamed state bank, local media reported.
In Suzhou, the digital yuan was used to pay half of the travel subsidies owed to public servants. Chinese ride-hailing giant Didi Chuxing said in July 2020 that it had entered into a “strategic partnership” with the central bank over the digital currency plan.
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