The new wallet of China’s state-issued digital currency has quickly become one of the most downloaded applications in the country, within days of its launch. Its use and integration with other apps have contributed to an increase of digital yuan payments, media reports unveil.
Wallet Launch Boosts Digital Yuan Ahead of Lunar New Year and Winter Olympics
In the week after it was offered to the public, the digital yuan (e-CNY) wallet has placed among China’s most downloaded apps. On Wednesday, a day after its premiere, its downloads exceeded those of Tencent’s Wechat, and it became the most popular app on Apple’s iOS, the South China Morning Post reported, quoting market researchers. By Monday, it was also the second most downloaded financial app in Xiaomi’s app store.
The e-CNY app is widely available for download but at the moment it can be used only in select areas. The Digital Currency Research Institute of the People’s Bank of China (PBOC), the developer of the software, is collaborating with authorities in 10 pilot cities including Shanghai, Shenzhen, Xiongan, Chengdu, Suzhou, and Beijing, where it has handed out digital yuan amounts as part of red envelope campaigns.
The launch of the application is part of efforts to promote the Chinese central bank digital currency (CBDC) ahead of the Lunar New Year which begins on Feb. 1, a popular time for gifting red packets, the publication notes. During the week-long holiday, the Beijing 2022 Winter Olympics will start on Feb. 4. Visitors at the venues in the capital will be able to use the e-CNY without having to open a local bank account.
The digital yuan can be spent through other payment apps as well such as Alipay and Wechat Pay, which account for 90% of China’s mobile payments market. The CBDC is also available in the applications of seven Chinese banks – Industrial and Commercial Bank of China, Agricultural Bank of China, China Construction Bank, Bank of China, Bank of Communications, Postal Savings Bank of China, and China Merchants Bank.
According to a report by China.org.cn, e-CNY payments have seen a “stratospheric rise” in the past week since the currency became available across Chinese mobile apps. The state-run news portal quotes the local services company Meituan which registered an increase of almost 43% in digital yuan-denominated payments, following an integration between its app and the e-CNY wallet. The value of transactions also spiked, by more than 64% over the week before the launch.
China’s digital yuan is arguably the world’s most advanced CBDC, ahead of similar projects in the U.S., EU, and Russia. An official at the PBOC revealed in November that the digital currency had been used in transactions worth nearly $10 billion. As of October, around 140 million Chinese residents had opened a digital yuan account. While promoting the e-CNY, the government in Beijing launched a nationwide crackdown on cryptocurrencies and related activities last year.
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