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More than $300 Million Digital Yuan Units Spent in China

More than $300 Million Digital Yuan Units Spent in China

For months, China has been conducting tests for its Central Bank Digital Currency (CBDC) and it appears that the country is just achieving one milestone after the other in this race. Even though China hasn’t officially launched the digital currency, it appears that the nation is already experiencing widespread adoption. According to a recent report by Reuters, approximately 2 billion yuan, which is worth $300 million, of the CBDC has already been spent in the country. A speech given by the Governor of the People’s Bank of China, Yi Gang, at the Fintech Week Conference in Hong Kong was cited in the report. 

The number was reportedly confirmed by Yi, who explained that almost four million separate transactions involving the digital yuan had been made so far. The transactions are spread out over a total of 12,000 scenarios, with all of them being made via pilot programs launched in different parts of the country. This initiative is part of the country’s mission to leverage blockchain technology and digitize its currency for bolstering its economy. Yi said that they had expedited their tests because the demand for contactless payment methods had gone up because of the coronavirus pandemic. 

The People’s Bank of China is expected to move along this path rapidly, ensuring that they can combine convenience with security for achieving payment efficiency. So far, China has spent a better part of this year on running tests for the digital yuan. It was reported that the first pilot program was launched in April, with the asset being used by the People’s Bank of China across four regions namely Suzhou, Chengdu, Xiogan, and Shenzhen. Eventually, these tests had been expanded to five other cities and these included the Hong Kong Greater Bay Area, Macau, and Guangzhou. However, some of the biggest scale testing programs were conducted in the last two months. 

It was reported by local news source Sina Finance last month that the $1.5 million worth of digital yuan had been distributed in the Luohu District in Shenzhen, as part of a promotional giveaway. According to the report, the government had distributed 50,000 units of the digital yuan in the pilot program to the recipients through a lottery. 200 renminbi were given to the successful applicants and they were allowed to spend it on more than 3,500 merchants that could be found in the region. This pilot program ran from October 12th to October 18th, and the government had committed to taking back the tokens left unused. 

A couple of days later, it was reported that even gas stations in Shenzhen had begun to accept the digital yuan, which was an accelerated testing program. It was confirmed that 11 gas stations would accept the asset and others had been slated for joining in the coming weeks. This initiative was introduced by a state-owned energy firm, Guangdong Petroleum. A license had been issued to the firm for this initiative and all gas stations had been fitted with barcode readers to allow people to make payments.

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