China Plans To Airdrop Digital Yuan To Boost Its Pandemic Hit Economy

China’s City of Shenzhen has decided to airdrop 30 million digital Chinese Yuan (e-CNY) in red envelops with the help of a lotter program. This move will be introduced in order to revive consumer spending amidst a pandemic hit economy.

This airdrop will be directed towards the local residents in attempts to revive economic conditions which have been affected by the lockdown. Several banks along with the joint efforts of Shenzhen Municipal Bureau of Commerce are working towards making the airdrop happen.

The airdrop will happen both online as well as offline. The total amount in these envelopes have been reported to be $4.5 million. There has been instructions attached to the airdrop. According to these instructions, users are required to login to the Meituan app.

After the login, users need to sign up for the incentive and then only will they have the access to get the e-CNY rewards which are a part of the lottery draw.

Here Are The Other Details Of The Airdrop

As mentioned above, these envelopes are distributed through a lottery system. Once chosen through the lottery method, the digital Yuan will be eligible to be spent at more than 15,000 in app merchant stores who will accept the e-CNY. The users or the participants of this lottery can win 88, 100 or 128 digital yuan.

Along with the Shenzhen Municipal Department are working with Bank of China, Agricultural Bank of China, Bank of Communications, ICBC, China Construction Bank, Postal Savings Bank of China, China Merchants Bank and WeChat. These red envelopes shall begin to be distributed from May 30.

The People’s Bank of China had previously stated that the digital Yuan can act as a potential tool that could be used to help advance local economies along with improving the efficiency of certain financial services.

Reportedly, many districts have been planning on releasing the same airdrops. For instance, Nansha District of Guangzhou supposedly plans on offering 10 million e-CNY to help increase spending.

Related Reading | As A Part Of CBDC Testing Chinese Residents Receive Digital Yuan

US Apps May Not Be On Board With Digital Yuan

While China continues to move forward with its plans of e-CNY, there might be other hiccups along the way. Bitcoin also is protected under the Chinese law. The country has also launched many pilot projects  as the asset now has been put to use in many other districts.

A United States bill is reportedly is hoping to ban the digital Yuan from making purchases in the app stores. This ban can be directly related to national as well as economic security reasons.

The main purpose of Lawmakers in the United States is to protect the country from what could be a disagreeable effect from the adoption of China’s digital yuan globally.

Currently, Shenzhen is one of the three cities in China where the residents are allowed to pay municipal taxes and charges related to the taxes through the digital Yuan.

Suggested Reading | Digital Yuan Ban: Senators Seek To Ban China’s E-CNY From US App Stores

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