China’s Tencent planning to create a digital currency research group

Tencent, Chinese’s Internet giant, owner of payment mobile app Wechat Pay,  is planning to create a digital currency research group for the further advancement of blockchain technology research projects, according to Chinese media outlet iFeng.

Tencent’s headquarter in Shenzhen | Image via SCMP

On December 23, it was reported that Tencent issued a notice, and after reviewing and determining by the head of the relevant business group, a digital currency research project group will be established. In response to this news, a reporter from Beijing Commercial Daily asked Tencent for confirmation. The other party did not deny the news and said that no more information was provided.

The content of the notice shows that in order to actively respond to the call of the “Opinions of the Central Committee of the Communist Party of China on Supporting Shenzhen to Build a Socialist Pioneering Demonstration Zone with Chinese Characteristics” on “Innovative applications such as digital currency research and mobile payment in Shenzhen”, and continue to promote the company’s payment strategy layout, guarantee the long-term healthy development of the payment business, and further leverage the advantages of resources and technology between departments.

Through the CDG enterprise development business group-payment basic platform and financial application line, WXG WeChat business group-WeChat payment line, S1 functional system-functional line, S2 functional system—financial line studies and reports to relevant business group leaders for review and decision. A digital currency research project group (virtual organization) is established under the enterprise development business group payment basic platform and financial application line.

It is reported that the project team is responsible for the overall advancement of digital currency research projects, follow up and implement the latest policies of relevant government departments, carry out digital currency-related research, and business model innovation and application scenario verification.

Tencent’s move to establish a digital currency research project team is not surprising to the industry. In fact, in the blockchain business, Tencent’s layout has been for a long time. As early as 2015, Tencent has started to build a blockchain-related research and development team; by 2016, Tencent began independent research and development of the underlying technology of the blockchain; in 2017, Tencent officially completed the research and development of the underlying technology and basically completed the overall Tencent area Construction of a blockchain ecological platform; As of October this year, Tencent also officially released the “2019 Tencent Blockchain White Paper”, which put forward ideas and reflections on the industrial blockchain, and demonstrated Tencent’s electronic invoices, micro Enterprise chain, Zhixin chain and blockchain bank draft.

“As the dominant player in the domestic social field, Tencent sits on the advantages of two major product ecosystems (QQ and WeChat), like Facebook and Whatsapp, and proposes a socially-based global blockchain digital currency mobile payment system network. It is also reasonable”.

Liu Feng, director of the Blockchain Technology Research and Application Research Center of Shanghai University of International Business and Economics, told a reporter from Beijing Business Daily that on the one hand, Tencent’s move made up for the direct confrontation with digital currency research and the next generation in the social field. The blankness of mobile payment is also an opportunity for China’s payment field to go abroad. He predicted that the joining of Tencent will inevitably bring a powerful amount of energy and give the market a boost.

However, Liu Feng also pointed out that at the same time, Tencent’s digital currency research project team still has many difficulties in testing the water. First, the current regulatory and legislative progress of the blockchain industry is slow, and the regulatory sandbox has not yet landed in the demonstration area, so R & D can only be carried out more cautiously in the early stage. Second, the ultra-large-scale use of blockchain technology in global scenarios Regardless of whether the technology or performance can not be met, it is necessary to further break through the existing technical barriers. Third, the way to cut into the business still needs to be further planned and deployed by Tencent Group.

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