The Chinese government continues to maintain its global dominance in the digital sovereign currency sphere. Meituan Dianping, a food delivery service company supported by Tencent Holdings, will likely be the first test case.
The company had already been in talks with the research wing of the People’s Bank of China (PBOC). The application would allow vendors to pay via digital systems, reducing payment delays. Tencent shares jumped on the news.
China’s digital currency pursuit outstrips that of other global efforts. The country banned Bitcoin and other digital currencies, ostensibly to reduce the amount of financial autonomy its citizens enjoy.
A well-implemented digital yuan would allow the government to have eyes on the exploding $27 trillion payment industry in the country. Authorities, intent on beating the adoption curve, will want to continue monitoring all digital transactions.
China Charging Ahead
The PBOC is the first sizable central bank to attempt to move forward with a digital currency system. Smaller economic nations like the Marshall Islands and Venezuela have also sought digital payment systems, but at a much lower scale.
The Chinese government has already expressed its desire to lead the world forward in this new currency age. U.S. economic dominance is likely at risk, given widespread moves towards cashless societies