- McDonald’s, Starbucks, Subway and other restaurants could test China’s central bank-issued digital currency (CBDC), known as the digital Yuan.
- The application of the digital Yuan test is expected to take place in the cities of Chengdu, Shenzhen, Suzhou and Xiong’an.
A Chainnews article has reported on the possibility that food industry giants such as McDonald’s, Starbucks, Subway, among others, could test China’s central bank-issued digital currency, known as the digital Yuan. The article claims to have information about a “pilot promotion meeting” on the digital Yuan in Xiong’an New District.
The meeting was apparently organized by the Office for Reform and Development of the Administrative Committee of the new Xiong’an District. There is speculation that the meeting was attended by merchants and institutions related to the test of the digital yuan, including the Commercial Bank of China, Bank of Agriculture of China, and Bank of China, including representatives of entertainment companies and restaurants. The participants of the possible test will mainly be restaurants, food companies and other retail businesses.
However, it remains to be seen whether this rumour proves to be true. To date, very little is known about the duration and nature of the digital yuan test. Nevertheless, it is known that the Chinese central bank has formed a special group to promote the digital yuan. The task force will also work with the administration and industry of the sites that will participate in the test. China’s state television station CCTV recently quoted a government representative confirming the participation the cities of Chengdu, Shenzhen, Suzhou and Xiong’an New District.
Impact of the digital Yuan on the global economy
In early February this year, CNF reported on some features of the digital Yuan. A representative of the Central Bank of China stated that the digital Yuan will be different from Bitcoin. The reason for this is that it will not be “suitable for speculation” and its value will not be subject to a currency pool like Facebook’s Libra. In addition, the official confirmed that the digital Yuan will be handled exclusively by China’s central bank.
Undeniably, the announcement of the digital Yuan has had implications for financial institutions around the world. The central banks of Japan, Korea and the European Union are studying the consequences that the launch of the digital Yuan will have on the world economy. In addition, they are independently developing their own CBDCs to counter the potential effects of the digital Yuan.