China: Starbucks is not testing the digital yuan
China: Starbucks is not testing the digital yuan
Crypto

China: Starbucks is not testing the digital yuan

By Marco Cavicchioli - 27 Apr 2020

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Starbucks has denied being involved in the ongoing tests in China to experiment with the use of digital yuan

A few days ago, the news had circulated that the well-known American chain had signed agreements to carry out payment tests in China with the new digital currency being studied in the country. 

The tests are actually about to start and they involve several companies, but evidently not Starbucks. 

In fact, a spokesman for the company has explicitly stated that they are not participating in the digital currency testing process in China. 

There would be 19 other restaurants and retail stores in Xiongan’s commercial district to take part in the testing of what is currently known as DC/EP, an acronym that actually means only Digital Currency / Electronic Payment, although it may not be the final name. 

These activities would also involve the McDonald’s and Subway chains, but unlike Starbucks, they have neither confirmed nor denied it so far. 

Other stores would be minimarkets and supermarkets run by Chinese companies, whereas those receiving tokens to spend for testing purposes would be several public sector operators who are likely to receive transport subsidies in this new currency. 

The actual operational spending tests should start in May, thanks to Alipay, Agricultural Bank of China, Ant Financial and Tencent. 

As such, to be involved in the tests will be the financial intermediaries who will manage the transactions, the citizens who will receive the subsidies and the companies that will accept from these citizens payments in DC/EP through the instruments made available by the financial intermediaries.

This CBDC could be the first in the world to be used on a large scale and it should come as no surprise that China is the first to carry out such tests with the intention of issuing a similar payment instrument on a large scale. 

One of the main objectives is to replace cash with tokens that can be traced much more easily, and since the Chinese are already widely accustomed to making payments via messaging apps such as WeChat, the spread of DC/EP may not be particularly difficult in the country. 

 

Marco Cavicchioli
Marco Cavicchioli

Class 1975, Marco teaches web-technologies and is an online writer specializing in cryptocurrencies. He founded ilBitcoin.news, and his YouTube channel has more than 11 thousand subscribers.

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