Chinese Banks, Firms Make Digital Yuan Smart Contract Progress
Chinese banks and businesses want to step up their use of digital yuan-powered smart contracts, as the financial and industrial sectors eye CBDC progress.
Per the Securities Times (via Stockstar), the state-run Postal Savings Bank of China has “officially” co-launched the nation’s first “prepayment product” to make use of digital yuan smart contracts.
Unlike many other CBDC projects, the e-CNY is not blockchain-based.
Rather than making use of decentralized ledger technology, it utilizes centralized IT solutions.
These solutions are all controlled by the central People’s Bank of China (PBoC).
But the PBoC has been keen to cherry-pick IT advances from the world of Bitcoin, crypto, and blockchain, with a view to integrating these in the e-CNY project.
One of these is smart contract technology.
Chinese economic thinkers believe this will help in business areas like financing and local government spending.
The Postal Savings Bank’s platform has been created in conjunction with China Fangyuan, a heavy machinery, transport, and construction-focused business group.
The parties have called their new platform Wuka, and say it can provide merchants with a range of “business capabilities,” including card issuance, project supervision, marketing, and management.
The media outlet noted that the new platform “introduces digital yuan smart contracts into the merchant business field.”
It added that the move would also “promote the use of the digital RMB” in the “prepayment space.”
Prepayment deals are common in industries where vendors provide custom- or tailor-made products or services.
Banks worldwide are growing increasingly keen on using smart contract technology.
But in China, state-run entities have attempted to integrate this with the digital
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