China’s soft rollout of the first major economy’s central bank digital currency (CBDC) continues apace. Yi Gang, governor of the People’s Bank of China, and Mu Changchun, director of the Digital Currency Research Institute of the bank, reported that the average weekly transaction volume of e-CNY is growing by 3 billion yuan (US$469 million) and consumers are opening private wallets at an average weekly rate of 8.5 million, according to October figures.
In remarks made during the recent Hong Kong Fintech Week, Changchun also emphasized China had no official timetable for launching the digital yuan, notwithstanding previous reports and widespread expectations that an official unveil would coincide with the 2022 Winter Olympics in Beijing. As of Oct. 22, consumers have opened 140 million personal digital wallets with total transaction volume of about 62 billion yuan (US$9.7 billion).
Fast facts
- Transaction volume and acquisition of private wallets related to the digital yuan, official known as e-CNY, has jumped significantly this fall. During the 17-week period between June 15 and Oct. 8, the weekly transaction volume grew by an average 12.6 million yuan while growth in downloading private wallets averaged just 6 million per week.
- A large-scale e-CNY promotion in October likely contributed to the surge. Beginning Oct. 12, Beijing subway passengers have been offered a single one-cent ride in exchange for setting up an e-CNY wallet. There is no limit to the total number of vouchers for this promotion. Beijing has more than 21 million residents, and they are all eligible.
- Transaction volume of e-CNY accelerated in the second half of 2021. From June 15 to Oct. 22, transaction volume increased by 275 million yuan in four months, compared with 235 million yuan growth in nine months from the end August 2020 to June 2021.
- In addition, the acquisition of private wallets also sped up. In the four months from June 2021 to October, consumers opened 119 million, compared with 21 million in nine months from the end of August 2020 to June 2021.
- Since June 2021, China’s central bank has issued seven batches of e-CNY red packets totaling 117 million yuan (US$18 million) in Beijing, Shanghai, Chengdu, Xiongan, Sanya and Suzhou, according to calculations by Forkast.News. Also, tech giants such as JD.com and Meituan have shared e-CNY red packets on their e-commerce platforms to encourage customers to test the digital currency.
- China is also exploring international use of e-CNY. The CBDC will be applied to cross-border trade and payment through the mBridge — a multinational e-currency exchange project initiated by Hong Kong, according to 15 application case examples issued by the Hong Kong Monetary Authority. The mBridge will step into the pilot stage in 2022.