Recent events in China indicate the country’s paradigm shift concerning digital currency. The digital yuan (e-CNY) is gradually forming a significant part of the Chinese currency through its rapid development. Furthermore, the government is putting more commitment and support into ensuring its adoption and consumption globally.Â
The Government Gifts Digital Yuan
This year’s Spring Festival holidays in China brought more digital yuan (e-CNY) exposure through diverse commercial and government-sponsored activities, as well as digital yuan donations made by the government to increase the currency’s adoption.
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The English Language translation of the Chinese daily newspaper, Global Times (GT), reported the new development on February 6, 2023. According to the report, the holidays saw the launching of 200 activities for Chinese digital assets across the country.Â
The donations from the local governments amounted to more than 180 million e-CNY worth $26.6 million. The donations enhanced digital asset consumption during the holiday festivity. These include consumption coupons, subsidies, and other programs related to the e-CNY.
These activities for e-CNY mark the first time the government spreads its digital tentacles after relaxing the COVID-19 restrictions.Â
The report noted that Jinan in Shandong Province and Lianyungang in Jiangsu Province, all in East China, carried out these e-CNY activities during the festive period. In addition, these cities also gave out digital yuan coupons to many residents.
Shenzhen’s local government in Guangdong Province was among those that used digital yuan to improve businesses by subsidizing several costs. It reportedly issued over 100 million e-CNY worth $14.7 million to subsidize the catering industry in the city.
Administrators Use Promotions And Upgrades To Implement KPI
China Daily reported about Hangzhou’s giveaway of digital yuan to residents. It mentioned that the government gave out 80 yuan worth of e-CNY vouchers ($12) to each resident, which amounted to a total of 4 million yuan worth $590,000.
The Global Times report confirmed that Meituan, an e-commerce platform, handled the e-CNY issuance for the Hangzhou city government. In addition, it noted that this New Year Festive giveaway to residents was completed in less than 10 seconds.Â
Commercial institutions were also part of the promotions with the digital yuan during the festive period. They participated in different areas such as transportation, supermarket, mobile communications, tourism, etc.
Generally, the Chinese government employed more features and targets to increase the usage and adoption of its CBDC over the past few months. A local news outlet, JS China, reported some outcomes from the meeting of the senior Communist Party officials in Suzhou.
They set 2 trillion CNY as a possible key performance indicator (KPI) for the city’s e-CNY transactions by the end of 2023. Furthermore, the municipal administration is expected to implement the KPI using promotions and other supportive factors.
Also, the e-CNY wallet app has a new feature known as ‘hongbao’ that allows users to gift money during the holidays. Another update that was released for the holidays allows users to enjoy contactless payments through Android phones.
Featured Image From Pixabay jplenio, Charts From Tradingview
