During the week surrounding the Spring Festival of the Lunar Calendar, the government of China dispersed digital cash belonging to the country's central bank worth millions of dollars. The New Year of the Lunar Calendar, commonly known as the Chinese New Year, is a time of celebration filled with various events.
As a result, Chinese localities have launched digital yuan events with a total value of over 180 million yuan (about $26.6 million) in an effort to encourage adoption.
The Chinese CBDC, also known as the e-CNY, has been under development for some time, and a concerted effort has been made to popularize its use.
China, like many other nations working on building their digital currencies, has tested the digital yuan in various sections of the country. These tests have taken place in different cities and provinces.
During the Lunar New Year, China releases the CBDC.
During the Lunar New Year, the Chinese government reportedly (1) initiated over 200 CBDC events across the country.
During the Lunar New Year, the cities in China wanted to encourage the consumption of CBDC by offering a variety of incentives, such as consumption coupons, subsidiaries, and other programs.
According to the article, the city of Lianyungang in the province of Jiangsu in East China and the city of Jinan in the area of Shandong in East China both handed CBDC vouchers over the Lunar New Year break to increase consumption.
Concurrently, several regional governments in China adopted the digital yuan as a subsidy for local enterprises to speed up the recovery process. For example, over the Lunar New Year vacation, Shenzhen, located in the province of Guangdong, issued CBDC worth a total of 100 million yuan (14.7 million).
The municipal administration distributed the e-CNY as financial assistance to the city's catering sector.
In addition, there are allegations that on January 16th, the city of Hangzhou provided each of its inhabitants with an e-CNY coupon worth 80 yuan (about $12). The city's efforts to bolster the CBDC during the period around the Lunar New Year cost approximately 4 million yuan when added up to their overall cost.
In China, interest in virtual currencies, or digital currencies, has increased. According to information collated by Meituan, the CBDC that the government of Hangzhou, located in Zhejiang Province, distributed before the holidays was redeemed within nine seconds.
China's Efforts to Accelerate its CBDC
In addition to the celebrations for the Lunar New Year, the Chinese government has been working to enhance the effectiveness of the CBDC by adopting several initiatives.
The e-CNYwallet app recently received an update that included a new function that allows users to send "red carpets." This function, launched in December, will enable users to send monetary gifts to one another.
Additionally, when the new year began, the wallet software received an update that included a new function that lets users of Android phones make contactless payments.
The upgrade makes it possible to make payments using the gadget even when it does not have power or internet access.
On February 1st, key governing party leaders in Suzhou's ruling party established an ambitious new goal for using the digital yuan. The party's officials found a plan for the city's e-CNY transactions to reach 2 trillion yuan by the end of 2023.