China’s Shenzhen district will give away 30 million digital yuan to boost local economy hit by quarantine
The Shenzhen Municipal Commercial Bureau is working with several banks to implement the idea of giving away digital yuan in red envelopes (a kind of Chinese equivalent of airdrop) that can be used both online and offline. The total amount that the government is going to allocate to the population is $4.5 million.
The envelopes will be distributed through a lottery. Each participant can win 88, 100 or 128 digital yuan. The Shenzhen Municipal Department is cooperating with the Bank of China, Agricultural Bank of China, ICBC, China Construction Bank, Bank of Communications, China Postal Savings Bank, China Merchants Bank and WeChat. Envelopes will be distributed to interested participants starting May 30.
The airdrops are an effort to stimulate the local economy, which has been hit by recent quarantines due to a spike in COVID-19 cases. Other districts are also working on similar airdrops, and the Nansha district in Guangzhou is offering 10 million digital yuan to support catering and retail businesses.
There has been much discussion, both internationally and within China, about the effects of the quarantine on the local economy. The country’s citizens were shocked by the sudden imposition of the restrictions and have not stopped showing anger toward such measures.
Some countries are concerned about the development of blockchain technology in China
China’s experiments with the central bank’s digital currency (CBDC) seem to be progressing well. The country has already launched several pilot projects, and the asset is being used in some areas. Meanwhile, bitcoin and other cryptocurrencies have been banned in the country (as has mining).
Nevertheless, some countries have expressed concern about the rapid development of blockchain in China. One such country is the United States. United States senators have drafted a bill aimed at banning digital yuan in app stores, citing national and economic security concerns.
Other countries have expressed concerns about China’s Blockchain Service Network (BSN) blockchain platform.
Japan, meanwhile, has said it will create its own CBDC modeled after Sweden, not China. Many people are cautious about developments in China, believing that there are risks to the national security of countries around the world in China’s actions.