Tencent Reportedly Creating Team To Work On China's Digital Currency Pilot

Shenzhen-based technology giant Tencent Holdings Ltd. TCTZF is creating a new digital currency team, Coindesk reported on Tuesday, citing local media reports.

What Happened

According to CoinDesk, Tencent sent out an internal notice to employees informing them that the company is seeking someone to head a new cryptocurrency research unit.

The unit will reportedly work with the Chinese government on its digital currency electronic payment (DCEP) pilot project in the city of Shenzhen, alongside working on other research and development efforts, CoinDesk reported.

Local media reports earlier this month had suggested that the People’s Bank of China (PBoC) is looking to accelerate the use of the digital currency in Shenzhen early next year, after piloting it in December.

An August report by Forbes had suggested that both Tencent and e-commerce giant Alibaba Group Holdings Ltd. BABA would act as an outlet for the DCEP, which was to be launched in November.

The PBoC rejected the idea of the November launch at the time but didn’t comment on the name of the partners.

Why It Matters

Tencent’s WeChat app and Alibaba’s Alipay control a majority of China’s mobile payment market.

The DCEP project, which had been in the pipeline for more than five years, was reportedly accelerated earlier this year, with Facebook Inc.-led FB Libra cryptocurrency project posing an imminent threat. 

Other central banks, including the European Central Bank and the Reserve Bank of India, are reportedly looking into the potential of state-backed stable cryptocurrencies too.

Photo Credit: そらみみ via Wikimedia