Shenzhen citizens to receive $1.5M as part of Digital Yuan promotion

China's PBoC is issuing $1.5 million of digital currency to consumers for its first public test of the digital yuan payment system.

By · Oct 10, 2020 . 6min read

Shenzhen Digital Yuan promotion news
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Shenzhen, a major Chinese city, is set to kick off a digital yuan program, which will give out a huge piece of funds to the general public. Shenzhen collaborates with the People’s Bank of China (PBoC) to giveaway 10 million digital yuan, approximately $1.5 million. The giveaway is part of a more comprehensive Chinese government plan to promote the digital yuan, China’s central bank digital currency (CBDC).

The Shenzhen municipal government declared a giveaway due to its first public test of the digital yuan payment system. The People’s Bank of China’s (PBOC) campaign begins as central banks worldwide rush to issue digital currencies. They intend to modernize payments systems and defend off inherent competition from privately published cryptocurrencies.

50,000 people to receive Digital Yuan in the proposed giveaway

Consequently, fifty thousand people will get the giveaway money on a lottery basis in 200 yuan quantities as part of the digital yuan tests. The trial is in the Luohu District. Thus, comprehending another red packet gifting in the same area to 5,000 medical and healthcare workers. This is in recognition of their COVID-19 offerings. This latest giveaway is a far more comprehensive and public test, involving the general public. 

However, one of the greatest difficulties for the central bank digital currency will be adoption. Maximum Chinese citizens are considerably content with utilizing prevalent digital payment solutions Alipay and WeChat Pay. One of the crucial ideas for issuing digital yuan is to stop an over-reliance on these private payment systems. Commercial banks are the main gateways for the People’s Bank of China to issue the currency, much like how cash is distributed to customers. Wallets can only hold confined amounts of money in order not to imperil the role of commercial banks.

In April, PBoC said that it led tests of a digital yuan payment system in four cities across China. Moreover, this includes Shenzhen. Additionally, the PBoC plans to pilot the system at future Winter Olympics venues. Earlier, the e-commerce giant JD.com has collaborated with the People’s Bank of China & Digital Currency Research Institute to develop mobile apps for China’s digital yuan. Moreover, it will promote mobile applications and blockchain platforms in line with PBoC’s anticipated central bank digital currency. 

Besides promoting digital currencies, the People’s Bank of China is blacklisting accounts pertaining to large crypto traders to battle money laundering. The current efforts come in line with a more comprehensive purpose of alleviating and ultimately abolishing criminal earnings and transactions. 

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