The Digital Yuan Will Be Integrated With Other Payment Platforms

2 years ago · Updated 2 years ago

✍️ 15 September, 2022 - 11:14 👤 Editor: Jakub Motyka

Recently China has launched a new CBDC, the Digital Yuan.
Due to the novelty of this currency, it is being discussed how to popularize it in the country.

Will payment platforms serve this purpose?

One of China's most ambitious digital projects, the Digital Yuan, expects to be integrated into various payment platforms that are recognized in the country. For several months, China has tried to boost the use of its digital currency, promoting it so that different businesses accept it. Their intention is that, eventually, the currency will be available as a payment method, it is some of the mobile payment platforms.

This issue had been previously mentioned by Fan Yifei, a deputy from the People's Bank of China. According to his statements, "it is important to standardize the necessary payment systems, to ensure the success of the Digital Yuan". This project contemplates standardizing the operation of all systems, either through QR codes, NFC or Bluetooth. Consequently, existing payment gateways will also have to adapt to new laws.

What Is The Digital Yuan And Why Is It Important To Enter Payment Platforms?

As such, this currency is a digital asset backed by the Central Bank of China, better known as a CDBC. In case you don't know, this means that it is a form of digital fiat money issued by the country side, which makes it legal and of value in the country of issue. In a few words, it is the equivalent of traditional money in digital, also being backed by the bank.

For several months, various crypto enthusiasts have discussed the importance of CDBCs in the market. Most allege that this type of coin represents the future of various traditional currencies. However, the Digital Yuan, like other CDBCs, requires a digital wallet. In this case, the inhabitants who have participated in the testing of this currency have downloaded an application from their mobiles to be able to associate their bank accounts with it. This allows them to pay quickly and as if they used physical money.

What Is The Difference Between This Token And The Cryptos We All Know?

Unlike crypto assets, the Yuan is backed by the central bank, also working on its database. In other words, every transaction made with this currency also stores personal data, transaction records and other data that cryptocurrencies do not. Despite this, and as we have mentioned before, there are many enthusiasts of this type of asset. On this subject, it has been constantly mentioned how digital currencies could help the environment, avoiding the printing of banknotes.

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