Digital Yuan Is Closing In On A Full Release As Major Institutions Start Using The CBDC

Digital Yuan Is Closing In On A Full Release As Major Institutions Start Using The CBDC

  • Alibaba’s Ant Group partnered with PBoC to develop China’s CBDC report.
  • The digital yuan could overpower the influence of WeChat Pay and AliPay in the future.
  • More institutions are adopting the CBDC as a form of payment.

Ant Group, a wholly-owned subsidiary by Alibaba, has been partnering with the People’s Bank of China (PBoC) on the central bank digital currency, popular as CBDC, a report from South China for the past four years China Morning Post reads.

This information was revealed over the weekend at a Digital China Summit in Fuzhou. MYbank, a mobile fintech app by Ant Group, was the intermediary to distribute the digital yuan since 2017. Additionally, the central bank’s main research institute, China Digital Currency Institute, picked up the app in mid-2019 to choose consumers to spend, pay and receive the CBDC.

“Ant Group, together with MYbank, will continue to support the research, development, and trial of PBOC’s e-CNY,” a representative familiar with the matter commented.

The influence of the CBDC is unquestionable across China with the trials conducted over major cities are well received by the population. At the core of the growing adoption rates is the support of China’s large banks such as the Industrial and Commercial Bank of China, the Agricultural Bank of China, Bank of China, HSBC, and the China Construction Bank, all of who have taken part in the trial phase of the digital yuan.

To further boost adoption, several large banks are promoting the use of the digital yuan in an upcoming festival on May 5th over the use of platforms such as WeChat Pay and AliPay. The banks are urging the population to download a digital wallet and purchase the digital CBDC, also known as e-CNY in a bid to make their payments “more convenient,” a representative said.

The continuous push towards a digital yuan controlled by the central banks will reduce the control and dominance private companies such as AliPay and Wechat have in mobile payments. To curtail big-company dominance in holding financial data, the Chinese government will launch a full public version of the e-CNY later in the year to battle with the private corporations.

All in all, big institutions have started embracing the CBDC as a form of currency boosting transactions within the country. JD.com, a China-based e-commerce company, announced Monday that some of their employees have started accepting to be paid using the digital currency electronic payment (DCEP) system.

Having participated in the DCEP trials, JD.com integrated the payment solution earlier this year in its business while paying some of its expenses using the digital yuan, a CNBC report stated

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Author: Lujan Odera

Bitcoin (BTC) Price Trading Analysis – April 19

After closing the weekly session at $56,280 in a bearish engulfing pattern, down 6% from the previous week, BTCUSD staged an abortive recovery in the early trading hours on Monday.

A daily close on Saturday below the key support level of 61165 triggered a rapid, alarming decline on Sunday, leading to roughly $4.9 billion worth of BTC long positions getting liquidated across exchanges.

As illustrated in the chart below, the price bounced off the primary trend line (lower trend line) at $51,500 and eventually secured the .618 Fibonacci level by daily close, but failed to close past the secondary trend line (upper trend line) at $56,900.

BTC1

In the early hours on Monday, an effort to reclaim the secondary trend line was rejected at the first time of asking. If the secondary trend line is not reclaimed by close on Monday, then a retest of the primary trend line could be in the offing. It’s critically important that BTCUSD holds on to the primary trend line.

Since October 2020, daily RSI has held above the all-important bull cycle bottom zone, highlighted in the chart below. Daily RSI is currently at its lowest since November, pending daily close, but still within the zone which must be retained.

BTC2

Chaikin Money Flow (CMF), which last week turned negative for the first time in seven months, is once again approaching negative territory, indicating that sell pressure may still persist.

Key support levels are $54,000 and $51,800. Key resistance levels are $57,500 and $59,100.

Zooming out and taking a long-term perspective of the market, after breaching 90 following March close, monthly RSI may be due for a corrective spell before swinging back to the new ATH price for this bull cycle towards the end of 2021.

BTC3As charted above, during the two previous post-halving rallies in 2013 and 2017, the first monthly RSI reaction low price, $150 in 2013 and $3100 in 2017, became the approximate floor price for the bear cycles that followed, in early 2015 and late 2018 respectively. If this trend were to hold, Bitcoin could be establishing the floor price for the next bear cycle over the next month or so.

It should also be interesting to see whether the end of this corrective phase coincides with the end of tax season in the US. The Federal tax filing deadline for the 2020 tax year was initially set for April 15 but has since been extended to May 17.

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Author: Lamps T