McDonald’s and Starbucks have been included in the Chinese Government’s Central Bank Digital Currency (CBDC) program to trial the initial launch in Xiong’an district.
China has for over two years now been pursuing its CBDC managed by the state-owned People’s Bank of China (PBoC). Coinidol.com, a world blockchain news outlet, reported on the progress of the project that seemed to have been in its testing stage. However, China seems to see a brighter future in the Western brands operating in the Communist country.
McDonald’s and Starbucks have just joined the list of partners for the trial of the project.
China, a country which had for a long time cracked down on cryptocurrency seems to be easing things for the industry. The country with 1.4 billion people certainly forms an axis for businesses of any kind.
Global food and beverage chain companies have penetrated the Chinese market. Although agricultural food products such as beef, pork, vegetables and cereals dominate, junk foods remain popular in the country. Despite the closure of 300 McDonald’s restaurants in China following the coronavirus pandemic, there are still 3,000 branches open, serving hamburgers and sandwiches, McCafe, breakfast, desserts and shakes, beverages, snacks and sides, chicken and fish, and salads.
Starbucks, on the other hand, is also a famous spot for Chinese nationals with 4,200 stores spread across 177 Chinese cities. The third Western fast-food network that has got on the list for trialling digital yuan was Subway.
It’s probably no wonder that these three companies were the only ones to be included in the pilot program. Considering the tensed relationships between The USA and China, the latter is hardly likely to welcome the US business in its territory. On the other hand, McDonald’s, Starbucks and Subway have become so popular over the entire world that they became international long ago. Besides, it is good to test the new digital currency within such big networks, while China has no fast-food chains of its own that would be so big.
Presently the trial stage of the Chinese CBDC has been deployed in four locations countrywide: Chengdu, Suzhou, Shenzhen, and Xiong'An. It is going to be used for micro-payments with a limited number of entities.
Despite the community anticipating its wide global launch, digital yuan might not be accessible to the general public soon enough.
While it is clear that the Chinese government’s digital currency design will not resemble Bitcoin, Ethereum, Litecoin, and other cryptos in terms of its decentralized nature, its full-fledged deployment might still require some regulatory changes to the existing financial system. Nevertheless, the Chinese government also plans to launch the currency ahead of the Beijing Olympics in 2022.
If China launches the currency before then, it is likely that it would gain momentum during the Olympic games as many international visitors flood China. Just as the government backs Unionpay cards and opposes VISA, Mastercard and other western debit and credit cards, Beijing is most likely going to tighten restrictions on other cryptocurrencies once the digital yuan is rolled out to protect the state-owned digital currency.