The top three stories from the Chinese cryptocurrency sphere this past week includes: a group of state-run commercial banks in China is testing digital wallet for its digital yuan; Viabtc’s founder Haipo Yang is proposing a new BCH fork called Bitcoin Cat amidst community feuds; leading crypto exchange Huobi launched DeFi Labs to drive decentralized finance growth, and more.

Four Chinese state-owned banks reportedly testing wallet for digital yuan

China’s central bank digital currency, or Digital Currency/Electronic Payment (DCEP), is a step closer to everyday use, as news come that the big four state-run commercial banks are conducting a large-scale internal testing of the digital wallet designed for the digital yuan.

Led by the country’s central bank PBoC, DCEP has been under test for months on various landing scenarios conducted by these commercial banks. Some internal staff of the aforementioned banks have reportedly started to use it in transfer, payment and other scenarios.

On August 3, the PBoC pointed out in a video conference for the second half of 2020 that the “closed trial of legal digital currency has been successfully launched” in the first half of the year, and the research and development on it will be “actively yet prudently promoted” in the second half.

Bitcoin Cash Community in China Seems to Favor another BCH Fork

Haipo Yang, founder of crypto mining pool ViaBTC and Bitcoin Cash (BCH)-based crypto exchange CoinEx, has recently proposed a new fork of BCH called Bitcoin Cat amid the community feuds over the Bitcoin Cash Difficult Adjustment Algorithm (DAA).

“BCH has long suffered from ABC and needs to change,” said Yang on Weibo. Later he took to Twitter to express his proposal and add that the BCH community “needs real leaders”, “everyone who has promoted Bitcoin Cash is welcome to join in and build CAT. Let’s make Bitcoin even more awesome.”

Upon his initiative, his proposal has caused a lot of discussion in the Chinese community, and it seems the BCH community in the country is mostly in favor of the fork. A line of BCH KOLs has voiced their support for Yang, and the tone is definitely not combative, but of joy. While for the time being, everything remains uncertain, “or may be terminated at any time”, said Yang.

Huobi pours tens of millions into DeFi investment and research

Huobi, one of the world’s largest cryptocurrency exchanges, has launched a new division focused on decentralized finance (DeFi) investment, incubation and research.

The Huobi DeFi Labs will begin with “tens of millions of dollars” in investment funds, according to a press release, and aims to help push forward the growing DeFi market. The centralized exchange (CEX)’s foray into DeFi comes at a time when the market is ballooning at a startling rate as the DeFi craze keeps getting bigger.

The DeFi market cap has been over $8 billion and the total value locked up in its smart contracts over $4 billion. The rapid expansion reminds crypto investors of the 2017 ICO frenzy, and many raise their worries about the potential bubble.

In China, crypto investors are now jokingly divided into two types based on their participation in DeFi, they are old-fashion crypto investors who stick to major coins, and neo crypto investors with DeFi coins in hand.

Bitmain and Canaan, still in a mess

The power struggle in Bitmain, the world’s largest bitcoin mining hardware manufacturer, is showing no sign of stopping, as the latest development has postponed the company’s July miner shipment for October.

Its rival, another China-based mining giant Canaan, is also in controversy as five directors have recently been removed due to contract expiration. Previous reports have it that there’s a power struggle ongoing inside the company which led to the reshuffle of the higher-up managers.

In the latest Hurun report, Bitmain, which topped the blockchain unicorn list in 2019, has led the way with the largest drop in valuation in this year’s list; and Canaan, which has gone public on Nasdaq though, has seen its stock price not perform well since its listing.