WeChat, China’s leading social networking and payment app, has added the country’s central bank digital currency (CBDC), to its payment services, according to reports in local media. The move aims to help broaden the appeal of the digital yuan.
WeChat now supports the fast payment function of the digital yuan wallet, making it the second payment platform to do so after Alipay.
This feature enables users to use the digital yuan for payments on certain WeChat mini-programs and other platforms. The pilot version of the digital yuan application’s “Wallet Quick Payment Management” page currently lists 94 merchant platforms that can be accessed, now including WeChat. WeChat Pay now allows digital yuan payments on certain apps, such as ordering food from McDonald’s and paying bills.
Users must authorize the digital yuan wallet operator to sync their WeChat-bound mobile phone number for successful activation of the WeChat payment wallet fast payment function. Once activated, payments to digital yuan-supporting merchants can be made through the WeChat app. Additional integrations are expected to become available gradually.
“Chinese consumers are so locked in WeChat Pay and Alipay, it’s not realistic to convince them to switch to a new mobile payment app,” said Linghao Bao, an analyst at Trivium China, a strategic advisory firm. “So it makes sense for the central bank to team up with WeChat Pay and Alipay as opposed to doing it on its own.”
The digital yuan, also known as the e-CNY, is being piloted in at least 26 Chinese provinces and cities. The token saw a jump in transaction volumes on Chinese e-commerce platforms during the 2023 Lunar New Year shopping season, helped by e-CNY handouts from authorities.
In December 2022, Alipay announced its access to the digital yuan acceptance network, allowing users to spend digital yuan consumption on platforms served by Alipay, including Taobao, Shanghai Bus, Ele.me, Youbao, Tmall Supermarket and Hema.
At this time, it is not clear how to forecast the future of cryptocurrency aligned with CBDC. However, one thing is clear: all countries and major financial institutions accept the wave of digital currency. In this digital currency acceptance, Bitcoin will keep its value storage digital gold position, and some major coins like Solana and Ethereum will take on another role as smart contracts. CBDC will compete with stablecoins, and we will soon see the newly defined stablecoin position that is combined with global political relationships.
Source: Cointelegraph