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China Issues $1.5M in Digital Yuan Trial as Lunar New Year Approaches

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by Ibukun Ogundare · 3 min read
China Issues $1.5M in Digital Yuan Trial as Lunar New Year Approaches
Photo: Unsplash

According to Chinese media calculations, the digital yuan trials now total about 110 million yuan.

Beijing, China’s capital city, is planning to roll out about 10 million yuan, worth $1.5 million, in another trial of the country’s central bank digital currency (CBDC) during the Lunar New Year holiday. Already, China had conducted two major tests of its digital currency, which is currently under development by the People’s Bank of China (PBoC).

China Hands Out 10M Digital Yuan in Test During Next Lunar New Year

An announcement by the Beijing government revealed that 50,000 Beijing residents would be selected to participate in the trial. Only residents with Chinese ID number or residence permits from Hong Kong, Macao, or Taiwan would have access to the test. The trial marks the third major test after Shenzhen and Suzhou have conducted previous tests.

The announcement revealed that the selected participants would receive 200 yuan or about $30 each in digital yuan. The participants can then spend the received digital currency at specific offline locations in the Wangfujing commercial area. The recipients can also spend the money on some parts of JD.com, during the next Lunar New Year holiday on the 12th of February.

In addition, the vouchers would be active for spending from the 10th of February and valid till the 17th.

Several central banks, like PBoC, have been working on developing their CBDCs. Apart from China, some other countries like Japan have also conducted tests using their digital currencies. China’s central bank expects that the digital currency would work through existing payment apps. Already, Mobile Pay and WeChat Pay by Tencent Holdings (OTC: TCEHY) have replaced cash as a form of payment.

Suzhou Government to Issue 30 Million Yuan in Digital Currency Test

Separately, Suzhou is also planning to issue $4.6 million (30 million yuan) worth of 50,000 red packets. This marks Suzhou’s second trial of the digital yuan.

Unlike Beijing, Suzhou said that holders of the red packets would spend the money till the 26th of February. The funds will also be acceptable in both physical and online stores. According to the South China Morning Post, more than 10,000 businesses are expected to accept payments with the digital yuan during the trial.

In October, the Shenzhen government carried out a lottery to issue 10 million yuan ($1.5 million) in digital currency. The lottery is part of China’s effort to conduct real-world trials for its digital currency. At the time, 50,000 people won out of almost 2 million applicants.

In December, JD.com announced itself as the first online platform to accept the digital yuan as the Suzhou government issued out 20 million yuan ($3 million) for further trials.

According to Chinese media calculations, the digital yuan trials now total about 110 million yuan ($17 million). Also, China has plans to conduct tests in more cities across the country.

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Ibukun Ogundare

Ibukun is a crypto/finance writer interested in passing relevant information, using non-complex words to reach all kinds of audience. Apart from writing, she likes to see movies, cook, and explore restaurants in the city of Lagos, where she resides.

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