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Recent developments in China point to a shift in the country's digital currency paradigm. The digital yuan (e-cny) progressively forms an important part of the Chinese currency by its fast development. In addition, the government has increased its commitment to global adoption and consumption.
The Government Gifts Digital Yuan
This year’s Spring Festival holidays in China brought more digital yuan (e-CNY) exposure through diverse commercial and government-sponsored activities, as well as digital yuan donations made by the government to increase the currency’s adoption.
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The English Language translation of the Chinese daily newspaper, Global Times (GT), reported the new development on February 6, 2023. According to the report, the holiday season saw the launch of 200 Chinese digital asset activities throughout the country.
Local government donations totalled over $180 million for a value of $26.6 million. Donations have improved the consumption of digital assets over the course of the holiday. This includes consumer coupons, grants and other electricity-related programs.
This is the first time the government is rolling out its digital tentacles after relaxing restrictions related to COVID-19.
The report noted that the jinan in Shandong province and lianyungang in Jiangsu province, all in Eastern China, performed these e-cny activities during the holiday period. Moreover, these cities have also distributed digital yuan vouchers to many residents.
The local government of Shenzhen in Guangdong province was one of those that used the digital yuan to enhance businesses by subsidizing multiple costs. It allegedly issued more than 100 million electronic cigarettes worth $14.7 million to subsidize the city's food service industry.
Administrators Take advantage of promotions and upgrades. To Implement KPI
China Daily reported about Hangzhou’s giveaway of digital yuan to residents. He mentions that the government has given 80 yuan e-cny bonds ($12) to each resident, for a total of 4 million yuan with a value of $590,000.
The report of the Global Times confirmed that meituan, an e-commerce platform, managed the issuance of e-cny for the government of the city of Hangzhou. Furthermore, he noted that this New Year's Eve gift to residents was completed within 10 seconds.
Commercial institutions also participated in promotions with the RMB during the holiday season. They have been involved in various fields such as transport, supermarkets, mobile communications, tourism, etc.
, the Chinese government has used more characteristics and targets to increase the use and uptake of its CBDC in recent months. A local news outlet, JS China, reported some of the results of the Communist Party's senior leadership meeting in Suzhou.
A possible key performance indicator (KPI) for the city's e-NCY transactions by the end of 2023 has been set at CNY 2 trillion. In addition, it is expected that the municipal government will implement the KPI through promotions and other supportive factors.
In addition, the e-wallet application includes a new feature called "hongbao" that allows users to donate over the holidays. Another update that has been released for vacation lets users enjoy contactless payments across Android phones.
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