The adoption of digital payments is increasing so rapidly that the People’s Bank of China (PBoC) is showing concerns about the declining use of cash which could lead to alternative means of payments such as Bitcoin and other public cryptocurrency networks.
According to CCN, an increasing number of merchants at tourist spots stopped accepting cash, relying completely on applications such as Alibaba’s Alipay and Tencent’s WeChat Pay to process payments.
The anti-crypto People's Bank of China, said there have been consistent problems with the circulation of renminbi cash, and the people’s response has been intense.
'Consumers at tourist areas, restaurants, and retail merchants have had their cash refused, which has damaged the renminbi’s legal status and consumers’ right to choose between payment methods.'
IDK. Was in major cities in China few months ago and it is basically cashless. Even vending machines you order and pay on your phone. Street vendors look at you oddly when have cash.— Gaunerd (@gaunetes) January 2, 2019
It is well beyond the US.
Read more: China's PBoC is not afraid of crypto
While cash loses its popularity in favor of private services such as Alipay and WeChat Pay, the People’s Bank of China is planning ahead to secure its hold on digital transactions.
In November 2018, the People's Bank of China questioned the advantages of decentralization and claimed that blockchain innovations are impractical and utopian, impeding the build-up of sufficient trust to compete with fiat models.
Back in August 2018, the Chinese government clamped down on crypto activity, blocking internet access to exchanges and increasing enforcement on the ban on crypto trading. In response, Alipay and WeChat ceased offering crypto trading services.
Even though the move from cash to digital payments seems to pave the way to alternative means of payments such as Bitcoin and other public cryptocurrency networks, the Chinese government continues to crack down on crypto and blockchain.
Alipay and WeChat Pay are now used to cover every type of payment and it might be just a matter of time, before they add crypto payments to their applications.
But first China will have to embrace crypto, and that won't happen any time soon.