$30m e-CNY Airdropped in Shenzhen to Boost Consumer Spending

The use of China’s Central Bank Digital Currency (CBDC) is currently being boosted by the city of Shenzhen, according to reports that the authority has airdropped 30 million Digital Yuan (e-CNY) to its residents.


According to the Shanghai Securities News, the airdrop was aimed at changing the resident’s consumer spending habits to be appropriately revitalized.

Per the report, the airdrop will be made or distributed through food delivery giant, Meituan Dianping, one of the private partners helping the Chinese government with the broad retail testing of the e-CNY. In order to receive the Digital Yuan airdrop, interested users will need to indicate interest in the program by signing up on the Meituan app, and applying for the incentive.

The final beneficiaries will be selected based on a lottery system, a trend which is common to Shenzhen and e-CNY airdrops. Successful residents will be able to spend the issued funds at more than 15,000 merchant stores that accept the e-CNY as payment for goods and services rendered.

The initiative from the Shenzhen city government is not the first of its kind as the officials continue to explore avenues to support the local economy amidst the growing incidence of lockdowns stirred by the Covid-19 pandemic.

The airdrop is also evidence that the CBDC from the People’s Bank of China (PBoC) is a very functional one and very close to a broad national launch. Despite the official launch date of the e-CNY not yet announced, a lot of accolades have been shared as the PBoC pushed for the new legal tender to feature at this year’s Olympic Games held in January. The CBDC also reportedly had transaction figures that surpassed records from international payment giants like Visa.

The report from Shanghai Securities News confirmed that previous airdrops like these are known to bolster consumer spending indeed, and expectations mount that this latest measure will also follow suit.

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China’s Central Bank Launches Major Crypto Crackdown in Shenzhen

The crackdown on cryptocurrencies appears to be gaining steam in China. Local reports state that the Shenzhen branch of the People’s Bank of China (PBOC) has cleansed 11 companies for their illegal cryptocurrency activities. 

Major Crackdown by Chinese Authorities

Chinese news outlet South China Morning Post reported this development on Wednesday, August 18.

According to the report, the PBOC prosecuted the companies as part of a special campaign to show a zero-tolerance to cryptocurrency trading. 

There are no specifics on the severity of punishment meted by the Central Bank. Shenzhen is a global hub for computer hardware development and houses several companies that develop mining equipment. 

This makes it one of China’s major regions for the fast-growing crypto community.

However, financial authorities have routinely carried out campaigns to halt the progress of any development linked to cryptocurrencies. This is per the national policy that places digital tokens like bitcoin as a significant threat to the country’s financial stability. 

Earlier in February, financial authorities closed eight companies involved in crypto-related services, including promoting digital tokens as investment assets and introducing foreign crypto projects to local investors. In addition, the local PBOC branch has also shut down illegal cross-border trading of foreign currencies and stocks in the region. 

China Has Taken a Strict Approach to Digital Currencies

Shenzhen’s crackdown on cryptocurrency is similar to initiatives taken by other regions in the country in recent months. Chinese Vice Premier Liu He revealed a crackdown on bitcoin mining and trading activities in May. 

Since then, there have been reports of government authorities ceasing mining operations in their regions, contributing partly to the market dip in May.

In addition, the Chinese central bank (PBOC) also released a statement in July calling for companies to stop crypto-related business or face major consequences. 

This development led to Huobi and OKCoin closing their local subsidiaries in Beijing. More companies have followed suit with BTCChina revealing that it has completely exited crypto-related businesses on mainland China. 

The crackdown has also coincided with the massive testing of the digital Yuan that is expected to be launched in the coming months. China is a major player in global finance and its crackdown on crypto-related business is a source of concern for the crypto industry.

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Suzhou Government to Airdrop $5 Million in Digital Yuan for CBDC Trial

Chinese city Suzhou is set to airdrop 30 million yuan ($5 million) to citizens in the latest round of digital yuan tests. This was revealed by the regional government yesterday in a press release informing citizens of the distribution.

150,000 Recipients to Receive Digital Yuan

The giveaway is expected to occur on Friday, with a total of 150,000 red envelopes containing 200 yuan ($31) set to be distributed to citizens across the city. The regional government revealed that the distribution was part of the government’s incentive towards the New Year Festival celebration.

Suzhou Citizens will have to install the necessary apps to make an appointment for registration for the lottery. The reservation period will take place on February 5 and close at midnight on February 6. Eligible participants will be chosen via a lottery draw 

Suzhou government further stated that the lottery result would be revealed on February 10 and the digital yuan sent through approved applications. Once received, citizens will spend the digital yuan at designated online e-commerce and offline merchants from February 10 to February 26.

Digital Yuan at Advanced Testing Phase

China has continued to accelerate its central bank digital currency, the “Digital Yuan .” Several tests have been conducted in several cities in the past few weeks as the government looks to accelerate the digital currency’s deployment in the first quarter of the year.

According to government officials, the last major digital yuan airdrop in Shenzhen was a success, with residents using the currency to perform over 140,000 transactions during the test period. This followed the announcement that the Agricultural Bank of China had kicked off testing ATMs that would allow customers to convert their cash to digital yuan.

China’s accelerated pace in deploying the digital yuan has caused notable concern from western economic powers. Economic rival Japan recently announced plans to research about developing a national digital currency. South Korea is also closing in on the final phase of its CBDC test pilot program.

European nations are not left behind with France already testing a prototype of the digital Euro in partnership with the blockchain platform Tezos. Estonia has also revealed plans to begin consultations and development of a digital currency that will be used within its financial system.  2021 is likely to be the year when CBDC finally become adopted by many nations.

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Chinese-Backed BSN reveals Plans to Develop a Universal Digital Payment Network

Chinese backed blockchain project BSN has revealed plans to pilot the adoption of a global CBDC system in 2021. Central Bank Digital Currencies (CBDC) was the major talk in 2020 and it appears that the push will be greater this year.

BSN developing a Universal Digital Payment Network (UDPN)

BSN revealed its plans for the year in a blog post on January 15. Starting with the need for CBDCs and the increased potentials of digital currencies in different payment systems. The blockchain body stated that it is planning to build a universal digital payment network (UDPN).

This project is expected to be completed in five years and will be based on the CBDCs of different countries. The blockchain body will work with international banks and technology to develop this digital payment network. According to BSN, once UNPN is completed any information system like banking, insurance and mobile applications will be able to use its services through APIs.

UDPN will also create a standardized digital currency transfer method and payment procedure that will be cost-effective and convenient. The UDPN system is currently at the design stage and BSN expects that a beta version will be launched in the second half of 2021.

BSN further reiterated China’s commitment to blockchain developments by revealing that it plans to create more public city nodes (PCN). The blockchain body also wants to build more BSN portals worldwide with 10 portals expected to be allocated in 10 regions. BSN also intends to increase its PCN internationally to 50 covering developed regions and developing countries globally.

It should be noted that BSN is a Chinese government-backed blockchain initiative that was first proposed in 2019.The project is primarily developed as a tech hub to provide small and medium-sized businesses to build and deploy products on blockchain technology

China Continues to Make Giant Strides towards Digital Yuan

China has continued its plans towards launching its digital currency the ‘’Digital Yuan’’ and has embarked on a series of tests. As reported by BTCManager, the latest round of tests took place in Shenzhen in the first week of the year. $3 million worth of Digital Yuan was airdropped to citizens of Shenzhen as part of the third major tests of the CBDC.

The Chinese government has also taken further steps towards integrating the digital yuan with ATMs. It was revealed on Monday, January 11 that the Agriculture Bank of China had begun testing ATMs that would enable customers to convert cash into digital yuans. These steps suggest that the launch of digital yuan is likely to occur in the coming months.

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