Increasing Shopping Opportunity Using Digital Yuan

It has been reported that more than 300,000 outlets in Changsha, the capital of China’s Hunan province, are now accepting digital yuan. According to the news in the official newspaper of Hunan province, more than 300,000 retailers in Changsha have started to allow shopping with digital yuan. According to shared data, residents of the city have transacted over 50 million digital yuan recently. In total, digital yuan transactions exceeded $1.2 billion on a city-by-city basis. Changsha, with a population of close to 8 million, was included in the digital yuan pilot zone along with Shanghai, Hainan, Xi’an, Qingdao and Dalian in April 2021.

China’s digital currency was launched in the first phase of the pilot in April 2020 in Shenzhen, Suzhou, Chengdu and Xiong’an. Currently, while pilot studies continue in 17 cities, cross-border payment tests of the digital yuan continue with the studies carried out in Hong Kong and Macau. The data shared by the People’s Bank of China (PBoC) reveals that the city that has adopted the digital yuan the most within the scope of the pilot study is Changsha. China maintains its position as the leading country among the central bank digital currency (CBDC) activities, where many countries continue to work. While many other countries are in the process of concept formation or decision on CBDC, China has passed the actual use of CBDC in pilot regions. As part of these efforts, the digital yuan was distributed to the citizens of the country via airdrop. In some regions, discount campaigns of up to 50% are applied on purchases of various goods and services to encourage the use of digital money.

China launched the digital yuan project simultaneously with a comprehensive ban on the cryptocurrency industry in 2021. In this context, China, while actually making moves against the decentralized crypto industry, did not give up on Blockchain technology and took the offensive to declare its own dominance in this area. With this policy, the Chinese state showed that it saw a system that it could not control as a threat to its economic system and took action accordingly. China’s comprehensive crypto ban took a serious toll, especially to crypto mining companies that were heavily active in the country at the time. Due to this ban, serious decreases were seen in the crypto money markets.