Chinese e-commerce giant JD.com said on Saturday that its fintech arm, JD Digits will accept digital yuan as payment for some products.
JD.com is China’s first virtual platform to accept the central bank digital currency, as part of an experimental giveaway of digital yuan to the citizens of Suzhou, according to the company’s post on its official WeChat account.
Under the trial, the People’s Bank of China (PBOC) and the municipal government will issue a total of 20 million yuan ($3 million). 100,000 consumers selected through a lottery will be receiving 200 digital yuan “red envelopes”.
This will be the second such program after the PBOC issued 10 million yuan worth of digital currency to 50,000 selected customers in Shenzhen in October, South China’s Guangdong Province. It was the first time the trail of digital yuan went public after a series of internal tests.
Last month, PBOC Governor Yi Gang said over 2 billion yuan had been spent using the DCEP so far in 4 million transactions.
The new round of public trials of the central bank-backed sovereign digital currency involves a wider range of consumer and application scenarios compared to the first test.
Booming Digital Industry
As we reported, the central bank of China is also discussing the technical pilot testing of digital yuan for cross-border payments with the Hong Kong Monetary Authority (HKMA). The exact date of the launch is unknown but it will offer an additional payment option, said Eddie Yue, chief executive of HKMA. Yue said on Friday,
“As the yuan is already in use in Hong Kong and the status of digital yuan is the same as cash in circulation, it will bring even greater convenience to Hong Kong residents and tourists from the Chinese mainland.”
The central bank governor also said on Monday that China will push forward the R&D of the digital yuan in a steady manner, launch pilot tests in an orderly manner, and improve its legal framework.
According to Pan Helin, executive director of the Digital Economy Research Institute at the Zhongnan University of Economics and Law, 2021 will usher in an important period for the digital industry as the technologies have become more mature after several years of development. Pan told the Global Times,
“In recent years, China’s digital industry has been booming, and new technologies such as big data, cloud computing, 5G, artificial intelligence and blockchain have been rapidly developed and widely applied in various fields of social economy, laying a good foundation for the development and application of digital currency.”