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- The pilot test is supposed to distribute approximately 19.25 million Yuan.
- A total of 350,000 digital red envelopes will be distributed through a lottery. Each envelope would contain a total of 55 digital Yuan.
- Digital Yuan may be a legal tender before the Beijing Olympics 2022.
China is all set to pilot its Central Bank Digital Currency (CBDC) in Shanghai. The pilot test will distribute approximately 19.25 million yuan (about 3 million US dollars) among the citizens through a lottery system. China is often seen as a pioneer in the CBDC sector and is currently ready to experiment with its government-backed Digital Yuan.
Distributed Digital Yuan can be Used for Small Scale Retail Payments
The Shanghai Municipality Information Office has announced that the Digital Yuan can be used for small scale retail payments in major cities of China, including Shenzhen. As per the announcement, a total of 350,000 digital red envelopes will be distributed through a lottery. Each envelope would contain a total of 55 digital Yuan. The lottery is in collaboration with the Shanghai branch of the Industrial and Commercial Bank of China and the cloud service of the Shanghai branch of the Bank of Communications. The lottery prize will be non-refundable.
China Maybe the First Economic Giant to Launch a Full-Fledged CBDC
China’s expedition on its digital currency has propelled other countries like the USA, Canada to explore the sector. One of the significant economic giants, China, has made a lot of progress in the Digital Yuan sector. After months and years of research and development, China has successfully created an attempt to make CBDCs a reality and integrate them with people’s lives.
However, the People’s Bank of China (PBoC) has still not announced the official dates of the launch of the Digital Yuan. But it is anticipated that it will be a legal tender before the Beijing Olympics scheduled for 2022. The visitors and the athletes that visit the country will be allowed to use the digital currency for purchases. This will be the first time when non-Chinese citizens will get a taste of digital Yuan. China has lately imposed a ban on cryptocurrency payments and has scaled the country’s mining operations. Analysts believe that somewhere China’s policies are deeply rooted in the launch of its digital currency.
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
