E-commerce giant JD.com is partnering with the People’s Bank of China Digital Currency Research Institute to build mobile apps that can support China’s digital yuan, local media reported.
Why it matters: JD is not the first company reported to be working with the central bank on the digital currency, but this deal has been described in more specific terms. The news also confirms that blockchain technology will be used in dissemination of the currency.
- Direct support for the digital currency could offer JD an alternative to dominant payments apps Wechat and Alipay.
Details: JD.com has entered a “strategic partnership” to build what the announcement calls mobile and blockchain platforms for the central bank digital currency, local media reported, and to integrate those platforms with JD’s existing ecosystems.
- The partnership is said to promote online and offline payments, and the development of a “digital wallet.”
Context: The digital yuan has been in development since 2014 and is currently piloted by select individuals in Shenzhen, Suzhou, Xiongan, and Chengdu. But these tests appear to be very limited, and few details have surfaced.
- The People’s Bank of China has repeatedly said that the digital currency has no set launch timetable, but that hasn’t stopped speculation.
- The pilots will be extended to Beijing-Tianjin-Hebei region, the Yangtze River Delta, and the Greater Bay Area region, the Ministry of Commerce said in August. The expansion is could take place by the end of the year.
- Reports emerged in August that claimed that employees of China’s four biggest banks were also testing the digital yuan.
- The central bank has said the currency will be tested at the 2022 Beijing Winter Olympics, but the roadmap to 2022 has not been revealed.
- Earlier in September, China Construction Bank made public a digital yuan e-wallet. However, the bank quickly withdrew the app.