In a bold move to accelerate the adoption of the nation’s central bank digital currency (CBDC), the city of Changzhou, China, is preparing to distribute approximately $700,000 worth of digital yuan tokens and coupons. This initiative forms part of a citywide shopping festival that adopts the cultural tradition of giving red envelopes, a symbol of good fortune in China, traditionally filled with cash during public holidays.
Pivoting to an increasingly digital world, Changzhou replaces the tangible cash stuffed envelopes with digital yuan tokens. The initial round of digital red envelopes started in June, with the city poised for a second round of distribution before year-end. The city reportedly wants to distribute the entire proposed amount before the close of 2023.
The approach comes with a captivating twist to further draw interest. The ensuing distribution will include coupons granting 30 yuan ($4.30) discounts for purchases up to 100 yuan ($14) or 50 yuan ($7) for 200 yuan ($28) purchases. These tokens, instead of being handed out, will be won through a lucky draw, fostering a sense of anticipation and enthusiasm among the residents.
The residents are asked to express their interest through the My Changzhou app, an application developed by the city’s government. The event is set to run from July 16 to July 20, and an estimated 10,000 residents will receive the digital yuan tokens and coupons from July 21.
However, a certain condition applies. To benefit from the discounts, the holders of these tokens will have to use the coupons by August 10. Plus, they will also have to open personal digital yuan wallets to partake in the event. This maneuver can be seen as a nudge towards fostering a habit of using digital currencies among the local population.
Several significant city shopping centers, including the Changzhou New Century Mall, theme parks, supermarket chains, and department stores, are said to accept payments made in the CBDC.
Moreover, a SIM card-based CBDC wallet solution, capable of functioning when phones are powered down, was released earlier by the central bank. Furthermore, DBS bank’s Chinese branch also launched a merchant collection service for corporate clientele.
All in all, Changzhou’s measure can be interpreted as not only a brilliant promotional push but also a strategic move towards the widespread acceptance of digital currencies, an upcoming inevitable global trend. Still, the limitation of these tokens with an expiry date underlines the efforts to control and guide the nascent market.
Source: Cryptonews
