Chinese internet giant Tencent, the owner of Chinese social media giant WeChat is reportedly seeking to create a digital currency research group with the aim of advancing the development of blockchain technology in China and abroad.
In a Monday report by China media company iFeng, Tencent published a notice to its employees on Monday announcing that it was in search of an individual to head the proposed new research group. The internet company has not responded to several inquiries from media houses but it did confirm to an inquiry by iFeng on the truthfulness of the information. It did not, however, provide any further clarification on the matter.
From a loose translation of the iFeng report on Monday, the media outlet wrote:
“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.”
This means that all Tencent projects in regards to the blockchain technology will be handled by the proposed research group.
The news comes before the launch of the official China government-issued digital currency dubbed DCEP that will be issued by the People’s Bank of China (PBoC). The DCEP will be issued to a select group of companies which include Tencent who will be in charge of disseminating the currency further to the population in a two-tier system.
Market analysts are now speculating that Tencent’s WeChat payment application WeChat Pay will be redesigned to enable payments that support the use of the DCEP now that the company is setting up a research group to allocate more resources towards blockchain development and applications.
Speaking to Industry media on Monday, Matthew Graham, who is the CEO of Beijing’ based blockchain advisory firm Sino Global Capital commented that,
“In our view existing digital payment solutions such as Tencent’s WeChat Pay and AliPay will coexist with DCEP for the foreseeable future.” He also added that “With that said, we’d be somewhat concerned if we were Alibaba or Tencent. Although DCEP undoubtedly will have beneficial aspects for these e-commerce giants, it’d be folly to not view DCEP as a potential competitive threat to their immensely important payments businesses.”