Shenzhen, an economically emerging city in southern China, issued 10 million digital yuan (or approximately $1.47 million) in a pilot program aimed at promoting the new form of currency. In collaboration with the People's Bank of China, Shenzhen distributed the digital currency to its residents through a lottery of 50,000 "red envelopes," each worth 200 digital yuan. Recipients of the red envelopes were instructed to download an application to access the currency and use it in designated businesses in the city's Luohu District.
The initiation of the pilot program follows China's announcement in April 2020 that it will begin testing the digital currency in certain regions across the country.
Commentary
Following the recent announcement by the Bank of Japan that it is taking initial steps toward a central bank-issued cryptocurrency, it is reasonable to predict that other nations will make similar announcements in the coming months. Eventually the issue will be whether one or two central bank-issued cryptocurrencies emerge as the widely used global standard, rather than each nation developing a digital currency that is used within its national borders.
Primary Sources
- China Daily Press Release: China's Shenzhen to Issue 10M Digital Yuan in Pilot Program
- China Daily Press Release: The Future of China's Economic Engagement
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