Will digital yuan replace cash in China? 1

China’s digital yuan pilot test has touched close to a staggering $14 million worth of transactions. The project, still in its pilot phase, has posted such a remarkable figure thanks to its massive patronage. This makes the digital yuan one of the most adopted digital currencies in the world. It also makes a case for the CBDC replacing actual cash when it is eventually rolled out and opened for the use of the general public.

China has completed 360 million digital yuan transactions

The report posted by the Chinese central bank noted that the total number of transactions made with the CBDC had reached a massive 360 million. Presently, the digital yuan is being tested across 15 provinces. Asides from that, the project has seen more than 5 million merchant stores sign up and help with the tests.

The pilot test is also taking shape in the public sphere, with the country flagging off many public payments using the CBDC. There is now a long list of government services users can enjoy using digital currency across the country. Some of these functions include monthly insurance payments, and tax rebates, among a few other uses.

China plans to extend the pilot test

The Central bank also reiterated its plans for the project while noting that the first plan is to ensure that a cross-border transaction is made possible between the country and Hong Kong. With this, the bank is looking for ways to ensure the support of the bank of international settlements. The bank also wants to ensure that small amounts transferred with digital currency can be anonymous while larger amounts can be monitored without compromising users’ data.

After the launch of the pilot test in 2020, China has been moving swiftly with its CBDC, with the country projecting it to replace cash fully in the coming years. Last month, there were plans to ensure that the test is extended to other provinces inside the country. In January, the Central bank in the country announced that the digital yuan had helped offset more than $13 million in transactions. This new update means that the total number of transactions between then and now is slightly under $1 billion.