DiDi Chuxing, a major Chinese ride-hailing platform, is going to implement a trial for China’s central bank digital currency (CBDC), the company announced on Wednesday.
The ride-sharing platform has entered into a strategic partnership with the Digital Currency Research Institute of the People’s Bank of China (PBoC) to implement this testing of digital yuan, officially known as Digital Currency Electronic Payment (DCEP).
“Under PBoC’s overall DCEP strategy and operation timeline, DiDi’s DCEP taskforce will design and implement pilot DCEP projects in accordance with rigorous safety, security, and governance standards,” DiDi noted in a statement (translated from Chinese).
DiDi is a major player in the Chinese market and serves 550 million users with its fleet across over 400 cities, according to the figures published a year ago. Backed by Softbank and Apple, the startup also purchased Uber’s Chinese operations in 2016.
Onboarding such a massive platform for the trial of digital yuan will give the Chinese central bank a massive testing pool.
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Can western countries catch up with the Chinese CBDC?
China is currently leading in the development of a CBDC which it started six years ago. When other major countries’ central banks are still checking the feasibility of launching such digital currency, the PBoC has already completed the development process.
The central bank is now working on the legality of digital yuan and has also tied with multiple banks and technology giants for the trial of the CBDC. It has already started to partially pay state employees in four provinces with the digital currency.
Media reports also revealed that local commercial shops including McDonald’s, Starbucks, and Subway are also looking into the trail of the CBDC.
Meanwhile, the multiple European central banks are also launching trail for digital euro while the South Korean counterpart is also weighing in.
In May, the PBoC governor Yi Gang stated that the central bank has no specified timeline to launch the digital currency, however, local media reported that the public launch could happen before ahead of the expected deadline given the threats from the US sanctions.