China’s digital currency trial returns to Shenzhen for round two, with twice the participants and double the payout

A total of 100,000 digital ‘red packets’, each containing 200 yuan (US$31), will be distributed to residents on Thursday via lottery – the latest test of China’s digital sovereign currency

This time it will take place in the tech hub’s Futian district, and winners have until January 17 to spend their e-yuan before it expires

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The People’s Bank of China is bringing its digital-currency lottery back to Shenzhen this week, with US$3.1 million worth of e-yuan to be spread out among 100,000 winners. Photo: Bloomberg

Published: 6:00pm, 5 Jan 2021Updated: 1:06pm, 6 Jan 2021

Shenzhen, China’s technological hub, will start its second trial of the nation’s digital currency this week, giving away virtual gift packets to its citizens as the nation steps up its testing efforts in a bid to launch the world’s first sovereign digital currency.

The Shenzhen government said it will give away 20 million yuan (US$3.1 million) via “red packets” – gift envelopes traditionally given out during holidays and special occasions – to residents of Shenzhen’s Futian district via a lottery.

A total of 100,000 digital red packets, each containing 200 yuan (US$31), will be distributed to residents on Thursday – doubling the number of recipients in the city’s first trial.

The recipients will have to download the official digital yuan app to their smartphones to use the currency, and they have until January 17 to spend it in selected stores in the city’s Futian district and on some domestic e-commerce platforms.

In mid-October, Shenzhen’s first week-long trial of the sovereign digital currency resulted in 8.8 million yuan being spent in over 62,000 transactions at the 3,389 designated shops in the city’s Luohu district.

The Shenzhen government confirmed that 47,573 people out of the 50,000 selected by lottery received their digital red packets, after 1.9 million residents applied to take part in the 10 million yuan giveaway.

Last month, the municipal government of Suzhou in Jiangsu province gave away 20 million yuan to residents as the People’s Bank of China (PBOC) continued to test the e-yuan, which the government hopes will replace some physical cash in circulation, but not money deposited in bank accounts.