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China’s new digital yuan users soar as transactions hit $10 billion

China’s new digital yuan users soar as transactions hit $10 billion

Last updated 23rd Sep 2022
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Since China introduced the new digital yuan (“eCYN”), the country’s central bank has seen a sharp rise in the wallet’s users this summer.

As of October, more than 130 million people opened the coin’s wallet and over 62 billion yuan (or $9.7 billion) transacted, according to a People’s Bank of China official.

In July, China’s digital yuan had roughly over 21 million wallet users making over $5.3 billion transactions, a sharp surge compared to October numbers.  

This is happening as global central banks are exploring ideas of introducing government-regulated digital currencies to enhance payments — and compete with popular cryptos such as Bitcoin, Ethereum, Dogecoin, and more.

Digital yuan yet to officially launch nationwide

China kick-started regional pilot programs and trials of the digital currency across the country. However, Mu Changchun, China’s central bank’s director-general of the digital currency institute, said that despite the wallet’s massive success, no official launch date has been set for its use across the entire country.

Changchun, speaking at this year’s Fintech Week conference in Hong Kong, said that although 140 million use the eCYN wallet, only 1.55 million users can take payments (and make transactions) with the new digital currency.

Thus far, wallet users can pay for government services, transportation, and utilities using the new digital yuan. Besides individual users, nearly 10 million corporate eCYN accounts were opened and are currently active.

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China taking aggressive steps to advance its eCYN

To massively popularize its new digital currency, China is cracking down on unregulated cryptocurrencies. Taking such aggressive steps has seen many crypto exchanges move out of China, and little-known cryptocurrencies shut down.

A case in point is when Beijing imposed a ban in September on all crypto transactions — and that was after it drove out all cryptocurrency mining companies from the country. 

In a recent report, JPMorgan, the US’s biggest bank, said CBDCs are the way to go for global firms, adding government-regulated digital currencies can save them up to $100 billion every year in transaction costs when making overseas payments.

Oliver Wyman, a consulting firm behind the making of the report, estimates that banks can use over $120 billion each year to make one-time cross-border payments.

In a joint statement with partner Jason Ekberg, the firm said CBDCs can solve international payment problems with ease. “The case for CBDCs to address pain points in cross-border payments is very compelling”.

Walter Akolo

Walter Akolo

Walter is a writer from Nairobi, Kenya. He covers the latest news on the cryptocurrency market and blockchain industry. Walter has a decade of experience as a writer.