When it comes to the development of a central bank digital currency (CBDC), China has been making significant progress, as the company is preparing for a launch in the next few years. Even though tests have been conducted for most of 2020, it seems that things have now been kicked off in high gear, particularly in the tech-advanced Shenzhen city. Economic Information Daily, a local news source reported earlier that gas stations in Shenzhen are now accepting payments in the form of digital yuan, as the CBDC trials in the city are moving at a fast pace. It was confirmed by the news medium that the asset is now accepted by 11 gas stations and more of them are scheduled to join in the coming days.
According to the report, the initiative was launched on Tuesday and a state-owned petroleum organization called Guangdong Petroleum is at the helm. There are barcode readers in all participating gas stations and citizens are only required to scan for making their payments. It was confirmed by Guangdong Petroleum that this initiative would be extended to 110 other self-operated gas stations before the beginning of the month. So far, the positive reviews of its initiative have given it some encouragement, as citizens have stated that transactions are easy and quick to complete.
The digital yuan can also be used for making payments for almost anything, including buying things at gas station mini-marts, servicing, and gas payments. Dual offline technology is used by digital yuan, which means that it will operate without a phone signal. As long as the mobile phone is on, it will only take it seconds for sending the asset via a safe network. This new initiative is in line with the giveaway pilot program that was announced by the Shenzhen government for the digital yuan.
On October 9th, a local news source had reported that Shenzhen’s Luohu District had initiated a program for sending 10,000,000 units of the digital yuan, which are the equivalent of $1.5 million, via a lottery to approximately 50,000 people. The applications for the lottery were opened for a week. It was confirmed that the lottery winners would be able to use the digital yuan for spending at any of the 3500 or more retail outlets in the city. However, the asset can be used only between October 12th and October 18th. It was confirmed by the district’s government that any units that were not used by the deadline would be taken back.
The giveaway program is set to expire, but it remains unclear where other people will get their hands on the digital yuan for spending at Guangdong Petroleum’s gas stations and why they may want to expand to other outlets. Nonetheless, it indicates that the country is making significant progress when it comes to its digital asset and would be preparing for launches on a wider-scale or introduce more tests soon. Pilot programs were launched back in April and a total of nine regions were included.