There are few projects in the cryptocurrency space more ambitious or anticipated than the digital yuan which is in development by China. The digital yuan will be the crypto-equivalent of the existing yuan fiat currency and was confirmed by the country over a year ago. Since then, it has undergone testing in select regions of China and is expected to be fully deployed in 2021.
The project is highly anticipated as it will be one of the most used tokens in the world, serving China’s population of over 1.3 billion people. Furthermore, there is concern over its possible international implications, especially with regards to China-USA relations. As such, any new detail about the currency is met with interest from the public.
Digital Yuan to be Messenger-Compatible
The 21st century offers numerous ways for people to pay for goods and services, including mobile options such as ApplePay. In the development of the digital yuan, it appears that this functionality has been taken into consideration. According to Mu Changchun, the head of the People’s Bank of China’s digital currency research institute, the upcoming token will be compatible with existing mobile payment structures in China.
These mobile payment options include WeChat Pay and Alipay which are popular in the country. Mu was quick to clarify, however, that the intention of the digital yuan is not to act as a competitor to these payment options but work alongside them for the benefit of Chinese citizens.
“They don’t belong to the same dimension. WeChat and Alipay are wallets, while the digital yuan is the money in the wallet,” he said. This was likely in a bid to counter previous reports that suggested that the Chinese government was planning to release the digital yuan as competition for the two mobile payment options.
Besides the compatibility of the digital yuan, Mu also touched on some of the early challenges being experienced by the team behind it. The token is accessed and spent via mobile applications and this brings up the challenge of being counterfeited. According to him, fake digital yuan wallets have already sprung up and the government is attempting to crack down on them.
This can be done, he says, if all parties involved with the token, from the central bank to the final consumer, work together. Should these issues be addressed, the token will be well on its way to widespread use by 2021.