HONG KONG, Nov 2 (Reuters) - More than 2 billion yuan ($299.07 million) has been spent using China’s new digital currency so far in 4 million separate transactions, Yi Gang, the governor of the People’s Bank of China (PBOC), said on Monday.
China’s digital yuan is one of the most advanced central bank digital currency (CBDC) initiatives underway around the world, as authorities globally respond to the threat from private currencies such as bitcoin or Facebook’s Libra.
CBDCs are designed to replace physical cash with a digital currency giving the holder a direct claim on the central bank.
China’s version follows a two-tier approach, with the PBOC issuing the digital yuan but commercial banks and big tech companies having a role in distributing it to consumers.
China has launched several pilot schemes for the digital yuan, most recently in the southern city of Shenzhen last month, when the PBOC gave 200 yuan ($29.75) each to 50,000 consumers selected in a lottery to spend in selected stores.
Yi, who was speaking at Hong Kong’s “Fintech Week” conference, said that the 2 billion yuan had been spent in pilot initiatives in four cities via 12,000 payment scenarios.
He said that the pilot programmes so far had gone fairly smoothly, though the initiative was still in its early stages.
“For a long time I see that we would have cash and digital currency coexisting in the future,” Yi said.
He added that there was still a need to create a “fairly complicated and fairly complete legal framework” for the initiative, particularly around issues of transparency.
$1 = 6.6873 Chinese yuan renminbi Reporting by Alun John; Editing by Kim Coghill