Banking News

Chinese media says TikTok parent to trial digital yuan

tiktok

As China’s central bank digital currency (CBDC) extends its testing phase, more organizations are joining the trials. Yesterday, ride sharing firm Didi announced it reached a cooperation agreement related to the currency known as the DCEP with the Digital Currency Research Institute of the People’s Bank of China. It said it would be used for smart mobility. Leading Chinese news outlet Caixin Global listed two other organizations, based on insider sources. 

One of the companies is ByteDance, the parent of TikTok the popular short video clip platform. Another is Meituan Dianping, the food delivery company.

If ByteDance is involved, it’s newsworthy because the company seems to be doing a bit of a dance itself. Following China’s imposition of new security laws in Hong Kong, several social media outlets said they would no longer respond to requests for user information from the Hong Kong police. They included Facebook, WhatsApp, Twitter, Google and Telegram. TikTok was a belated addition. 

This follows India banning several Chines apps, including TikTok after violence flared up on the border between India and China. The reason given was to protect India’s sovereignty and the Indian government alleged that Chinese apps surreptitiously move data outside of India and use the data for mining and profiling.

Chinese nationals run parent ByteDance, but technically, as with many major Chinese tech companies, it’s registered in the Caribbean. TikTok is one of several businesses. The ByteDance Hong Kong subsidiary owns its main Chinese operating entities. 

Meanwhile, the testing of the Chinese digital currency is progressing with screenshots first leaked three months ago. Shortly afterward, state media published cartoons explaining the concept, and a deeper story explaining certain aspects of how it works. The digital renminbi will be rolled out in five locations, Shenzhen, Suzhou, Xiong’an, Chengdu, and future Winter Olympics sites.

The Chinese government continues to insist that the digital currency is still at the research and development stage, including in a talk by the Governor of the central bank a month ago.