China Conducts First Digital Currency Experiment of the Year in Tech Hub Shenzhen

Rapid Steps Toward the Introduction of Digital Yuan

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kwon Jae-hee] China is launching a public trial of digital currency in Shenzhen, Guangdong Province, a 'technology hub.'

According to China Securities Journal on the 4th, Shenzhen City and the People's Bank of China have decided to distribute a total of 20 million yuan (about 3.35 billion KRW) of legal digital currency by lottery to 100,000 Shenzhen citizens, each receiving 200 yuan (about 35,000 KRW).

The lottery application period is from the 1st to the 4th, and the winners can receive the 'Digital Yuan' by installing a dedicated mobile phone application.

From the 7th to the 17th, the Digital Yuan can be used at about 10,000 designated commercial facilities in Shenzhen. The designated commercial facilities range from supermarkets to restaurants, cafes, fashion stores, and electronics retailers.

Previously, the Chinese government conducted public tests in Shenzhen in October last year and in Suzhou, Jiangsu Province, in December.

With each test, the scale of circulating Digital Yuan and the number of participating commercial facilities have increased. At the same time, various technical experiments such as e-commerce payments and offline short-range contact payment methods are being additionally conducted.

China plans to officially introduce legal digital currency before the Beijing Winter Olympics held in February 2022.

The Chinese government has the ambition to replace the US dollar, the key currency, by enabling the Digital Yuan to be used in international trade and payments in the long term.

This content was produced with the assistance of AI translation services.