Report: Tencent-backed food delivery giant partners with China's central bank to test digital currency
July 15, 2020, 12:31PM EDT
1 min read
The People's Bank of China has partnered with food delivery company Meituan Dianping to test its central bank digital currency, according to a new report from Bloomberg.
Citing unnamed sources, the report asserts that Meituan has "been in talks" with the PBOC's research unit "on real-world use cases" for the currency, which has been called Digital Currency Electronic Payment (DCEP). Bloomberg called the tie-up a "major step in the token's mass adoption," but said that the specifics of the partnership are not final. The new reporting appears to confirm an assertion made last week by Chinese news outlet Caxin.
China is widely expected to be the first major economy to issue a central bank digital currency (CBDC), perhaps as early as this year.
The project with Meituan is the latest known collaboration involving the PBOC's digital currency research unit and a Chinese technology company. Just last week, ride-sharing firm Didi said it had entered into a similar partnership. Meituan and Didi each host billions of dollars worth of daily transactions, according to Bloomberg. In April, the PBOC's digital currency research team inked a similar-sounding deal with SenseTime, a leading artificial intelligence startup.
But what do these research collaborations mean exactly? In each case, the details are murky and should be taken with a grain of salt. But as The Block has reported, it is likely that some of China's technology companies, particularly Tencent and Alibaba, will act as distributors of DCEP once it goes live. It would also make sense for the PBOC to plug its digital currency directly into consumer applications — like ride-hailing and food-delivery — that already see massive transaction volumes.