digital currency Photo: VCG

China's official digital currency, dubbed as DC/EP, will be tested in the form of commuting subsidies to the government workers in Xiangcheng district in Suzhou city, East China's Jiangsu Province in May, and insiders revealed more tests are being carried out in other Chinese cities too. 

Local civil servants, and employees of local enterprises and institutions in Xiangcheng, whose wages are paid through the "Big Four" state-owned banks, will complete the installation of the central bank's DC/EP digital wallet in April. 

In May, 50 percent of their commuting subsidy in their salary will be distributed in the form of digital currency, according to a report from chinastarmarket.cn on Thursday.

"The exposed case in Suzhou could be testing the waters of a market reaction," Cao Yin, a blockchain industry insider, told the Global Times on Thursday, indicating that more onsite trials will be implemented in other cities.

The latest move also comes amid China's accelerated move to launch the digital currency amid the COVID-19 pandemic.

Agricultural Bank of China (ABC), one of the "Big Four" state-owned banks, has launched an app to test the digital currency that is reportedly undergoing trials in four cities, including Suzhou, Shenzhen, Chengdu in Southwest China's Sichuan Province, and Xiong'an New Area in North China's Hebei Province, an insider confirmed to the Global Times on Wednesday.

Media reports said the pilot scenarios will include transportation, education, medical treatment and consumption.

CITIC Securities have estimated that it's possible that China's official digital currency will be launched within the year with its issuance hitting 1 trillion yuan. Nevertheless, Cao noted that though it's possible that the official launch could come within the year, but will only apply to limited application scenarios before being promoted to the wider public.

"To encourage people to use it will need some time," Cao said.

Global Times