With each passing day, the number of nations actively researching the concept of central bank digital currencies (CBDCs) grows.
While China’s digital yuan project has gotten the most coverage, countries such as the UK, Sweden, and Japan have been doing CBDC development and testing in recent months.
China outlawed the provision of crypto-related services by financial institutions and payment businesses in May. In addition, people accused of utilizing cryptocurrency in criminal ways were arrested in large numbers in China in June.
Experts view the efforts coming out of Beijing as an indication of China’s attempts to nurture its nascent e-currency and reset the international financial system. At the same time, the debate rages over whether the volatility of cryptos is a sign of fundamental weakness or simply a hiccup in the road.
The People’s Bank of China wants to be the first major central bank in the world to introduce a digital currency.
The PBOC has performed trials in several important cities, including Shenzhen, Chengdu, Shanghai, and Hangzhou, whereas its western counterparts have been more cautious.
The advantages of using e-currency are numerous. As more transactions are conducted using centralized digital money, the government has a greater capacity to monitor the economy and its citizens.
According to multiple accounts, the digital currency was sent through an app meant to allow real-time monetary transactions, but only at a few select retail locations for the time being.
Similar CBDC lotteries have also been held in several of the locations as mentioned above, demonstrating China’s determination to make its digital token widely available.