The Chinese central bank has stepped up development of the new digital currency e-RMB and has already began trials in several of its major cities which includes Shenzhen, Suzhou, Chengdu, as well as a new area south of Beijing, Xiong’an, and areas that will host some of the events for the 2022 Beijing Winter Olympics.
This move would make China the first major economy to operate a digital currency as coronavirus pandemic continues to limit physical contact globally.
According to Chinese media, the currency has been formally adopted into the cities’ monetary systems, with some government employees and public servants to receive their salaries in the digital currency from May. The currency would be used to subsidise transport in Suzhou, but in Xiong’an the trial primarily focused on food and retail.
Although digital payment platforms already exists globally but this is the first time it completely replaces existing currency activities.
In a similar move, Facebook is also set to announce its own cryptocurrecy, Libra. A move that would shake up the global cryptocurrency industry and the global banking system.
Facebook says the currency is meant to connect people who dont have access to traditional banking systems and with over 2.4 Billion Facebook users, the move is a big deal.
Transactions with Libra will be available as a standalone app – as well as on WhatsApp and Facebook Messenger platforms – as early as 2020. It will allow consumers to send money to each other as well as potentially pay for goods and services using the Facebook-backed digital currency instead of their local currency.
References:
https://www.google.com/amp/s/amp.theguardian.com/world/2020/apr/28/china-starts-major-trial-of-state-run-digital-currency
https://libra.org/en-US/