BEIJING/SHANGHAI (Reuters) – China’s central bank is conducting tests of a digital yuan payment system in four cities across the country, it told Reuters on Tuesday.
The People’s Bank of China (PBOC) responded to Reuters’ queries following reports in local media last week that it was pushing forward with a digital currency application, which had lifted digital-currency related stocks.
The digital currency institute of the PBOC said it was implementing internal closed trials of the central bank’s DC/EP electronic payment system in the four cities and intends to pilot the system at future Winter Olympics venues. The cities are Shenzhen in southern Guangdong province, Suzhou in eastern Jiangsu province, Xiongan new economic zone near Beijing and Chengdu, capital of southwestern Sichuan province.
It said the DC/EP system remains in a period of research and development, and that the pilots do not mean the PBOC has officially issued digital yuan. The tests will not affect yuan issuance, circulation or financial markets outside of the testing environment, it added.
Last September, Mu Changchun, deputy director of the People’s Bank of China’s payments department, said that China’s proposed new digital currency would bear some similarities to Facebook’s Libra coin and would be able to be used across major payment platforms such as WeChat and Alipay, a senior central bank officer said.
He also said the development of the coin would help protect country’s foreign exchange sovereignty as commercial applications of such currencies expanded.
(Reporting by Ma Rong and Andrew Galbraith; Editing by Jacqueline Wong)
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