After testing its Digital Renminbi use in some of the small cities, China is now planning a big CBDC giveaway for Beijing residents. The Chinese government has planned a 40 million renminbi ($6.2 million) lottery giveaway in form of digital currency.

China has been conducting such programs for a while as it goes on to test the CBDC acceptance among its population. For the distribution of its CBDC, the government has also collaborated with some of the biggest financial players like Ant Financial.

To apply for the current lottery, Beijing residents can use two major banking apps and win one of 200,000 so-called red packets. As per the information provided by the Beijing Local Financial Supervision and Administration Bureau, each of these packets will have 200 yuan or $31 which can be spent with selected merchants. The deadline for this application is June 7, reports CNBC.

We can say that the Chinese central bank is moving one step closer to its nationwide launch of the CBDC. In April 2021, PBoC deputy governor Li Bo said that the central bank will possibly expand the scope of its digital currency pilot projects. The Chinese central bank has been keen to introduce the CBDC during the 2022 Beijing Winter Olympics.

Earlier this year in February 2021, China conducted a similar exercise in Chengdu City. The central bank handed over 40.2 million in the Digital Yuan lottery.

China’s Race With CBDCs

China has been an early participant in the game of CBDC and aims to take a lead over other powerful economies. There have been some talks that China’s CBDC development could potentially threaten the dominance of U.S. Dollars in international markets.

Clarifying this matter, PBOC Deputy Governor Li said that the PBoC has no such plans. He said:

“For the internationalization of renminbi, we have said many times that it’s a natural process and our goal is not to replace (the) U.S. dollar or any other international currency. I think our goal is to allow the market to choose and to facilitate international trade and investment.”

Even the U.S. has started taking CBDC developments seriously. Fed Chairman Jerome Powell recently stated that the U.S. central bank will release the research paper on Digital Dollar by this summer.

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Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.