Clearin’ the cache… more like cash. China’s prepping its digital piggy bank to pay public workers in the city of Changshu (population 1.7M) fully in digital yuan (#digi-yuan) starting next month. The project will affect all public workers, from teachers to government officials — and marks the country’s biggest push to circulate its digital currency.
Number yuan: Back in 2021, China became the first major economy to launch an e-currency. Over 100 countries, including the US, have been playing catch-up since.
Mixed reaction: Changshu’s digi-yuan project is trending on Chinese social media. While some say it could help curb government corruption, others worry that older people will struggle to take their finances online.
Sorry, anon… All digi-yuan transactions are recorded on a digital ledger that’s monitored by the Chinese government, giving the surveillance state even tighter control (picture: digi-yuan expiration dates to boost spending). Chinese citizens lead the way in global mobile-payment adoption, but getting them to use digital yuan could depend on integration with payment superapps:
Tap to pay: Alipay and WeChat Pay each have 1B+ users and process hundreds of billions of dollars’ worth of annual transactions. China has struggled to get its citizens to use its digi-yuan app, because most of them use superapps for payments and social interactions.
Competing with corporate: The digi-yuan was tested as an express payment option on Alipay last year, and China could exert greater pressure on tech companies to fully integrate it.
The e-conomic race is on… China, India, Nigeria, and a handful of other countries have launched digital currencies. Now China is positioning the digi-yuan for international use, which could offer an attractive alternative to the US dollar for sanctioned countries like Russia. Meanwhile, the US Treasury is reportedly close to finishing its development of a digital dollar, which could give millions of unbanked Americans access to digital payments.