Digital Yuan Upgraded with Smart Contract Functionality and New Use Cases
• China’s digital yuan has been upgraded with new smart contract functionality.
• It has also been given new use cases, including buying securities and making offline payments.
• Users have the chance to receive a share of an 8,888 yuan „red envelope“ when they make purchases on the Meituan app.
The People’s Bank of China (PBoC) is taking steps to ensure that its digital currency, the digital yuan, or eCNY, is ready for use. The central bank has recently upgraded the currency with smart contract functionality, as well as new use cases for buying securities and making offline payments.
The smart contract function was launched on Meituan, a Chinese app offering retail and food delivery services. When users place an order and pay with their e-CNY wallet, a smart contract triggers and searches for keywords and purchased items in their order. If a user buys something on the list of keywords for the day, they go in the draw to win part of a prize. The prize is a share of a „red envelope“ known locally as hongbao containing 8,888 yuan, worth a little over $1,300.
The digital yuan has been in the works since 2014, with the PBoC actively testing the currency in various cities over the past few years. The new smart contract functionality, as well as the new use cases, are meant to increase the appeal of the digital currency and make it more widely accepted. The PBoC has also been working on developing a digital yuan wallet, which is expected to be released soon.
The digital yuan has been designed to replace the paper yuan, offering users a secure and easy way to make payments without having to carry around cash. It is expected to reduce the cost and complexity of making payments, as well as provide faster settlement times. The digital yuan is also expected to have a positive impact on the Chinese economy, as it is expected to reduce transaction costs, increase transparency, and facilitate better oversight of financial activities.
In addition to the smart contract functionality and new use cases, the digital yuan has also been designed to be secure and private. All transactions are recorded on the blockchain, meaning that they are immutable and cannot be tampered with. The PBoC has also implemented strong security measures, including multi-factor authentication and encryption, to ensure the privacy and security of all transactions.
The PBoC has also been working on expanding the network of institutions that can use the digital yuan. The central bank has already signed partnerships with various commercial banks, as well as retail outlets and payment service providers. This will allow the digital yuan to be used for a variety of transactions, including online payments, offline payments, and even securities trading.
The digital yuan is an exciting development in the world of digital currencies, and the PBoC is taking steps to ensure that it is ready for use. With its smart contract functionality, new use cases, and secure infrastructure, the digital yuan is set to revolutionize the way payments are made in China.