Beijing is planning to launch its digital currency, and due to this, the shares of China’s fintech market are soaring high as investors are preparing themselves for the digital currency. This launch will increase the demand for security and payment services within the country.
CSI fintech theme index used to track the index of major financial technology firms showed that the market had gained more than 50% in 2019. Some big gainers in the list are Beijing Certificate Authority that provides electronic authentication services. The share prices for the firm soared by nearly 200% this year.
Another firm that saw an increase in their shares is 360 Security Technology Inc, the most significant network service provider for China. They witnessed a jump of more than 50% in the shares.
In August, Mu Changchun, the deputy director of the People’s Bank of China’s payments department, announced that China is almost ready to release their digital currency. This proposed digital currency is somewhat similar to Facebook’s Libra coin and could be used across various payment platforms like WeChat and Alipay.
As soon as the announcement was made, the investors decided to jump in the market and bought the shares for fintech firms despite no clarity on when Beijing will launch the digital currency. Yi Gang, governor of the central bank, informed everyone that PBOC has no timetable for rolling out the digital currency.
The industry that revolves around digital currencies consists of circulation operation services providers, providers of e-wallets, and banking IT service providers.