• China’s central bank, the People’s Bank of China (PBOC), announced the continued expansion of the country’s central bank digital currency (CBDC), the digital yuan.
• The digital currency is currently undergoing a pilot program expanded to 17 more provinces across China.
• Two new features, offline payments and smart contracts, have been introduced alongside the CBDC pilot program to improve its use cases.
The People’s Bank of China (PBOC) recently announced the expansion of the digital yuan, a central bank digital currency (CBDC), across 17 more provinces in China. This move is part of the bank’s efforts to provide the public with a digital alternative to the traditional paper currency.
The digital yuan was first tested in the four major cities of Shenzhen, Suzhou, Xiong’an and Chengdu in 2020. From there, the pilot program was expanded to seven more cities in December. The latest expansion of the program to 17 additional provinces will help the PBOC increase the reach and usage of the digital currency.
The PBOC is also focusing on launching a system that will allow consumers to “scan with one code” when making payments using the digital yuan. This means that merchants will not have to increase their costs to support digital yuan payments.
In addition to the expansion of the pilot program, the PBOC has introduced two new features to the digital yuan. The first is an offline payments feature, launched on January 23, which allows users to make payments without the need to access the internet. This is done through NFC (Near-field) technology that enables communication between two electronic devices over a distance of 4 cm or less to confirm payments.
The second feature is a smart contract capability, which was introduced earlier this month on the e-commerce app Meituan. This feature allows users to win a daily prize of $1,312.
The PBOC hopes that these new features and the expansion of the pilot program will help increase the usage and adoption of the digital yuan. The bank also plans to continue innovating the digital currency, so that more people can benefit from its use.