Chinese state-run media announced this week that American chains McDonald’s, Starbucks and Subway would be among the companies to take part in the country’s cryptocurrency pilot program. The Securities Times reported that 19 companies in total would be involved in the digital currency trial in Xiong’an, an area southeast of Beijing.
The currency is being developed by the People’s Bank of China (PBOC), the country’s state-run bank. The cryptocurrency aims to make digital transactions easier in the world’s second-largest economy, and will be compatible with Alipay and WeChat Pay, two popular mobile payment apps.
Xinhua News Agency has reported that further tests of the digital currency will likely be conducted in the Chinese cities of Shenzhen and Chengdu ahead of the 2022 Winter Olympics in Beijing. The Chinese cryptocurrency program, known as the central bank digital currency (CBDC) project, has been in development for six years.
Mu Changchun, the head of the People’s Bank of China’s digital currency research institute, said in December that the currency would be a “digital form of the yuan.”
“The currency is not for speculation. It is different to bitcoin or stable tokens, which can be used for speculation or require the support of a basket of currencies,” Mu said. Mu has said the cryptocurrency would provide a degree of “anonymity” to users, although there are privacy concerns regarding Beijing’s possible surveillance of the digital money.
Cryptocurrency is becoming more recognized as legal tender in the international community. German banks, for example, are legally allowed to store cryptocurrencies such as bitcoin on behalf of their clients starting this year.