China’s digital yuan has witnessed tremendous growth as the central bank ramps up its CBDC pilot in the last one-and-a-half year.
The central bank digital currency (CBDC) of the nation, which had seen transactions amounting to 1.8 trillion yuan by the end of June, was discussed at the conference held in Singapore on July 19 to shed light on its development.
The introduction of the digital yuan started in January 2022. With about 120 million wallets being utilized for roughly 950 million transactions, it has attracted much attention. Each transaction costs roughly $260 on average.
Despite the tremendous amount of transactions, the adoption of the digital yuan still needs to grow compared to China’s enormous population of 1.4 billion people.
Although a few trials have been carried out in Hong Kong, it has primarily been used for domestic retail payments. The Bank of China Hong Kong recently started a trial for its customers at specific retail shops in the area to promote cross-border applications of the digital yuan.
This is the third international test of Hong Kong’s central bank digital currency (CBDC). Another noteworthy experiment run by the Bank of China Hong Kong was enticing clients to create a BOC e-CNY wallet to obtain a bonus of $14 (100 yuan) redeemable at the Hong Kong supermarket chain U Select.
Additionally, the Chinese government is pushing to use the digital yuan to pay public sector employees’ salaries. The CBDC has been linked to popular payment networks like Alipay and WeChat, providing customers quicker and more practical payment choices. According to reports, $2.3 billion worth of digital currency was in circulation as of the end of June.
