The rising adoption of digital assets has resulted in multiple countries adding support for digital currencies. Earlier today, China’s central bank, the People’s Bank of China (PBOC), announced the continued expansion of the country’s central bank digital currency (CBDC), the digital yuan.
The digital currency is currently undergoing a pilot program expanded to 17 more provinces across China. The country’s central bank said it is focusing on launching a system allowing consumers to “scan with one code.” The report noted:
The People’s Bank of China stated that in the future, it will continue to carry out innovative applications of digital renminbi to realize the interconnection between the digital renminbi system and traditional electronic payment tools, so that consumers can scan with one code, and merchants can also support various transactions without increasing costs as much as possible.
Two New Features Introduced Alongside
Alongside the CBDC pilot program’s expansion across China, the country’s central bank is also looking to improve the use cases of the digital yuan. It will introduce two core features, offline payments, and smart contract capabilities, to the CBDC.
The offline payments feature, launched on January 23, will allow users to make payments without the need to access the internet. This will work via NFC (Near-field) technology that enables communication between two electronic devices over a distance of 4 cm or less to confirm payments.
The smart contract feature, on the other hand, which was introduced earlier this month on the e-commerce app Meituan allows users to win a daily prize of $1,312 that is divided among winners.
China To Enhance The Digital Yuan (CBDC) Adoption
To increase the adoption of the CBDC right from the start, China announced plans to offer wealth management products that accept digital yuan payments in pilot provinces. A major investment bank such as China Galaxy Securities will offer these wealth management services to only a few customers.
Notably, China’s central bank has since been expanding the establishment of the CBDC over the past year. The PBOC has already carried out nearly 30 “red envelope activities” in pilot areas to advance consumption and low-carbon travel and make the digital yuan a payment method with practical utility for consumers.
While the adoption of CBDC is only starting to warm up, digital assets have since become a notable investment. Over the past few weeks, investors have increased their bets on these assets, pushing the global market cap to $1 trillion and above for the first time in over five months.
Despite the minor retrace in crypto assets today, the global cryptocurrency market still stands steadily above the $1 trillion mark. It currently sits at $1.09 trillion, at the time of writing down by 1.8% in the last 24 hours.