Chinese city of Changzhou distributes $700,000 worth of digital yuan tokens and coupons as part of CBDC pilot project

Chinese city of Changzhou distributes $700,000 worth of digital yuan tokens and coupons as part of CBDC pilot project

Changzhou, a city in China, is attracting attention with its pilot project for the country's central bank digital currency (CBDC), the digital yuan. The city plans to distribute about $700,000 worth of digital yuan tokens and vouchers during an upcoming city-wide shopping festival. Inspired by the traditional practice of giving away cash in red envelopes, Changzhou will issue e-CNY in “lucky red envelopes.”

The distribution of the digital red envelopes began back in June, and now Changzhou is preparing for the second round of giveaways. The remaining tokens are scheduled to be distributed before the end of 2023. The latest giveaways include coupons that provide discounts on purchases. Customers have the option to receive either a 30 yuan ($4.30) discount for purchases worth up to 100 yuan ($14) or a 50 yuan ($7) discount for purchases totaling 200 yuan ($28). The tokens and vouchers were distributed through a raffle in which interested residents were asked to register via the My Changzhou app developed by the city government.

The event is scheduled for July 16-20, with digital yuan tokens and vouchers scheduled to be distributed to 10,000 residents starting July 21. Similar to initiatives in other regions, the distributed tokens have an expiration date. To benefit from the discounts, residents must redeem the vouchers by August 10th. Participants will also be required to open personal digital yuan wallets to participate in the event.

Changzhou is proud that several well-known shopping malls in the city now accept CBDC payments. These include the Changzhou New Century Mall, theme parks, supermarket chains and department stores. This highlights the city’s commitment to adopting and integrating digital currencies into its local economy. Additionally, the central bank has launched a SIM card-based CBDC wallet solution that allows users to transact even when their phones are turned off, adding even more convenience.

However, efforts to launch China’s CBDC are not just limited to Changzhou. DBS, a leading bank, has also launched a merchant debt collection service for corporate customers in China. This highlights the growing ecosystem surrounding the digital yuan, with financial institutions realizing the benefits of integrating the CBDC into their services.

Changzhou is contributing to the further development and adoption of China's CBDC by organizing these giveaways and actively promoting the use of the digital yuan. As the country continues to explore the potential of digital currencies, initiatives such as these play a crucial role in familiarizing the public with the benefits and convenience of digital transactions.