Today Huawei announced that the HuaweiMate 40 series of smartphones would support China’s central bank digital currency (CBDC). It provides a digital renminbi hardware wallet and hardware-level security.
Other features include controllable anonymity depending on transaction size and dual offline transactions. In the absence of a WiFi signal, p2p payments can be made by touching phones using Bluetooth technology. We’re guessing that this may be the primary method for offline transactions, as the hardware security would make it trickier to manipulate. Offline digital currency transactions are generally viewed as a security challenge.
Huawei has the inside track because it was involved in the first digital yuan pilots alongside the four largest state-owned banks and the three biggest telecoms companies. Its role was to provide cloud technology.
China has been a little secretive about launching its eCNY digital currency. Despite significant public trials, it still downplays an imminent launch. But the Huawei phone is yet another sign that the production phase is not that far off.
A week ago, the Shenzhen government announced the results of a lottery in the area where almost 2 million people applied for a digital currency award of 200 yuan ($30), eventually given to 50,000 people. Notably, the wallets could still be used after the pilot’s end and be topped up with additional funds.
Huawei phone supports China’s digital yuan CBDCIt also recently published a draft law that would give the digital currency legal recognition.