Beijing and Shanghai to test digital yuan in 2021

China could fully issue its own centralised digital currency as early as this year

Chinese cities, DCEP                                 

Major cities in China plan to support the testing of China’s sovereign digital currency (DCEP). Beijing, Shanghai, and Shenzhen will all conduct pilot projects to promote the digital yuan this year, which could facilitate the official launch of the government's cryptocurrency this year, too.

According to a report from Chinese state media outlet Global Times, Beijing Mayor Chen Jiningong said, while presenting his government work report at the Fourth Session of the 15th People's Congress, that the capital will accelerate the creation of “innovation showcase zones” for the fintech and professional services industries in 2021 while promoting the digital yuan as a pilot.

Giving an indication of the readiness of Chinese cities for a digital yuan, Shanghai Mayor Gong Zheng also indicated in his government work report that the digital RMB pilot program will be promoted this year. Zheng added that the city will continue to open up financial opportunities and promote digital currency. 

Likewise, the Governor of Guangdong Province, Ma Xingrui, stressed his support for the transformation of Shenzhen into an innovative pilot zone for digital yuan testing.

Last week, the Shenzhen authorities announced they are holding the third in a series of lotteries that give away digital yuan. The third lottery has a total value of 20 million digital yuan ($3m) and residents of the city will receive prizes of 200 yuan ($30) inside a red envelope if they win the lottery. 

The plans of the largest Chinese cities may indicate that China has entered the final stage of testing the state cryptocurrency and intends to launch it in the near future, potentially even this year.

In addition, the Chinese Blockchain Service Network (BSN) plans to present a beta version of its DCEP by the second half of 2021. BSN is also working on a Universal Digital Payments Network (UDPN), which is expected to go live in the next five years.


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