Digital currency in China (2)

I had presented the main features of the digital currency -数字货币 – Chinese here, according to the available data. Today, the Chinese press has recently released some information.

No planning?

On August 14, the government announced the test areas’ extension to 28 provinces and cities managed directly by the government. The Beijing-Tianjin-Hebei zone (京津冀), the Pearl and Yangtze deltas, and the central-western region are concerned. Questions are being asked about these developments. The Chinese newspapers echo rumors : Shenzhen apartments will only be sold with this currency and that it will not be used to buy gold or foreign currency. Nothing has been officially denied. A Central Bank official only stated that there was no definite schedule for this. Hard to believe!
Since the end of April, in the new Xiongan economic zone south of Beijing, many retailers, Starbucks, McDonald’s, JD.com and Subway, are already using tomorrow’s currency. Didi Chuxing, the Chinese Uber, has already conducted tests with its half-billion customers.

The winners?

Ant Financial and Tencent would be associated with certain projects in the field. Companies in the financial services industry that could benefit from this innovation include: Westone Information Industry 卫士通, Client Service International Inc 科蓝软件,Shenzhen Forms Syntron 四方精创,Koal Software Co 格尔软件, HyUnion Holding 海联金汇 and Hengbao Co Ltd 恒宝股份.

The likely adoption of digital currency is linked to many prospects. China has long sought ways out of the dictatorship of the dollar god. This is one path. Digital currency is, of course, part of the digitization of society stimulated by the two leading groups Alibaba and Tencent, and covered by the central government. Dirty money will have more difficulty evaporating. It will allow better control of the capital.
On the other hand, Big Brother will know more about everyone. It’s clear, a different world, a different model is needed. On the whole, the Chinese accept it as long as growth is there and shared – in part!

Articles on finance here

28 August 2020

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