Some 100,000 lucky residents of Suzhou city in the eastern Chinese province of Jiangsu are set to receive digital red packets worth 200 yuan (over $30) next Friday. The lottery, which will distribute a total of 20 million yuan ($3 million), will be held on the eve of a year-end shopping festival known as ‘Double 12’, sometimes called Couples’ Day.
To claim their prize, the winners will have to download the official Digital Renminbi App. The app is currently not accessible to the general public and can only be downloaded via a special link.
After receiving the virtual money, shoppers will have around a fortnight to spend it, with some 10,000 shops participating in the trial.
JD.com, with over 440 million active customers and hundreds of thousands of brands, has become the largest company to join the initiative. On Saturday, the company’s fintech arm announced via its official WeChat account that it will accept digital yuan as payment for some products, becoming the first online mall to do so.
The Suzhou lottery is set to become one of the biggest real-world tests for the digital yuan as China moves towards a cashless society. Earlier this year the government in Shenzhen, the country’s leading tech hub, carried out a lottery to distribute a total of 10 million yuan ($1.5 million) worth of the digital currency, making the upcoming trial twice as big.
Shenzhen and Suzhou are among four Chinese cities where the government has been carrying out limited trials of the digital currency. Beijing has also announced that the digital yuan will be tested during the 2022 Winter Olympics Games.
The digital yuan, officially known as the Digital Currency Electronic Payment (DCEP) and projected to replace paper money, will be linked to the holder’s smartphone number, with transactions taking place through an app. Unlike cryptocurrencies, the token will be issued and backed by the country’s central bank.
© 2020, paradox. All rights reserved.