Rise of Digital Yuan Brings New Challenges for China Tech Giants

For the past decade, private companies in China have led the way in the digitization of money, with Tencent Holdings Ltd. and Ant Group Co. setting up enormous private payment networks and cryptocurrency-mining operations providing the fuel for the global Bitcoin boom. Their emergence was a break from Chinese financial history, which has been marked by aggressive centralized control. Things may now be reverting to the norm.

“Over the last few years of this internet-technology boom, private companies have swallowed up the markets where regulators fall behind,” says He Yifan, the founder and chief executive officer of blockchain startup Red Date Technology Co., which works closely with China’s top economic planning agency. “But at the end of day, the Chinese government will step up and rein it in regardless.”