China’s Central Bank digital currency, Digital Yuan or e-CNY is one the first and unique Digital currency launched by any government. Within the week since it was made available to the general public the digital Yuan (e-CNY) wallet was positioned among the top apps in China. On Wednesday, just a few days following its launch the app’s downloads surpassed the downloads of Tencent’s Wechat and the app was the most downloaded app for Apple’s iOS. As of Monday, it had become the second most downloaded app for financial services in the Xiaomi app store.
The app is accessible for download, but at present, it can only be used in certain regions. It is the Digital Currency Research Institute of the People’s Bank of China (PBOC) which is the software’s creator the application, is working with the authorities of 10 cities in the pilot program, which include Shanghai, Shenzhen, Xiongan, Chengdu, Suzhou, and Beijing in which it has distributed digital yuan in the context of red envelope campaigns.
The application’s launch is part of the efforts to increase awareness of the Chinese central bank’s cryptocurrency (CBDC) prior to the Lunar New Year which begins February. Furthermore, China is looking to utilize Beijing Winter Olympics to demonstrate the power of its digital currency to the world. China has begun to distribute its digital currency to spectators and athletes prior to the Olympic games, the first significant analysis of the virtual currency’s popularity among foreigners.
The digital currency can also be used to purchase other payment applications including Alipay or Wechat Pay, which account for 90 percent of China’s mobile payments market. This central bank digital currency is also accessible through the apps that are offered by seven Chinese banks.
According to a research, the e-CNY transactions been experiencing an “stratospheric increase” over the last week, since the currency was made available on Chinese mobile applications. The state-owned news website mentions local services firm Meituan which reported an increase of 40% in the amount of digital Yuan paymentsfollowing the integration between their app and the electronic CNY wallet. Transactions’ value increased by over 64% in the period prior to the launch. Visitors can download an application or obtain an actual card that stores the digital currency and convert foreign banknotes to electronic yuan at self-service kiosks.
The Chinese digital yuan is undoubtedly the most advanced CBDC that is way ahead of comparable projects across the U.S., EU, and Russia. In October, approximately 140 million Chinese citizens had set up an account in the digital currency. While advertising the e-CNY campaign and promoting the e-CNY, the government of Beijing has launched a massive enforcement campaign on cryptocurrency and related activities in the last year.
Gargi Sinha is working as Senior Journalist at Confea. She has completed her Masters in Journalism from Delhi University. She has interest in crypto and blockchain technology.