- Many Chinese people are still afraid of monitoring and are unwilling to utilize digital yuan.
- Some Chinese localities have started paying state personnel in the country’s CBDC.
Reportedly certain state Chinese workers who are paid in “e-CNY” or digital yuan hardly use it and have been changing it to physical cash, implying that China’s digital currency initiative is still in its early stages and has significant challenges.
Some Chinese localities have started paying state personnel in the country’s CBDC, although most of these early adopters change it to cash quickly, according to a May 13 story from the South China Morning Post.
Adoption Challenges
Government employee Andrew Wang said he wasn’t very concerned about the concept of digital currency as he was only receiving a tiny portion of his income in digital yuan.
His wife, on the other hand, is paid in digital yuan but immediately converts it to fiat cash since the currency has no practical use. The e-CNY wallet isn’t a suitable medium for her to deposit funds or purchase financial products, Wang said.
According to SCMP’s report, even though China has supposedly been a “functionally cashless” society for over a decade, many Chinese people are still afraid of monitoring and are unwilling to utilize digital currencies like the digital yuan.
According to Yi Gang, a former governor of the People’s Bank of China, more than $250 billion worth of transactions had been done using the digital yuan as of July 20, 2023, despite these issues. Numerous Chinese cities have distributed more than 180 million yuan ($26.5 million) in subsidies and consumption coupons since the CBDC’s launch in 2020 in an effort to increase its adoption.
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