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Facebook scaled back objective for its own digital currency, but China gets on with a digital yuan app

Facebook scaled back objective for its own digital currency, but China gets on with a digital yuan app

Check programs for China’s sovereign digital currency started last week as Libra, a cryptocurrency sponsored by Facebook, scaled back its objective to become a worldwide currency.

The first view of the planned digital currency came out on Wednesday when a screenshot of a test version developed by the Agricultural Bank of China was leaked.

The next day after it was leaked, the National Business Daily disclosed that the Xiangcheng district of Suzhou was supposed to put out the currency to use in May by paying a part of the travel subsidies given to public sector workers in digital form.

The 21st Century Business Herald also relayed that an unnamed depository financial institution, which is test running the official digital currency, has allowed a number of its Communist Party members to pay their membership fees.

The Digital Currency Research Institute of the People’s Bank of China, the agency that’s responsible for digital currency development and testing, confirmed that it’s conducting trial programs via China’s state-owned banks.

It said the pilot strategy for the digital currency would be held in four cities – Shenzhen, Suzhou, Xiongan, and Chengdu. It also stated that the 2022 Winter Olympic venues could even be used to test the currency.

But it announced that these test versions and applications were not final and “it doesn’t mean that China’s sovereign digital currency is officially launched.”

Presently, the tests and trials are going to be conducted in “closed environments” and can not have any impact on related institutions.

China has not stated the specific date for launching the digital yuan but last week’s reports have fanned speculation that its launch might be imminent.

The share prices of companies with a business concerning digital currency surged last week in Shanghai and Shenzhen.

Facebook’s Libra project was once proclaimed as a replacement currency for the web era but these hopes have faded within the face of strong scrutiny from regulators.

Last week, the Libra group decided that future currency is going to be a digital unit tied to an existing currency like the US dollar or the Euro, rather than a fresh token based upon a basket of currencies.

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