The digital yuan that the application supports is a currency developed by the Digital Currency Research Institute of China, which aims to replace the country’s paper money and coins.
Previously, the free e-CNY app was only available through private links, but now it is freely downloadable by the general public. However, the new subscriptions for the service are limited to Chinese cities that are testing the digital yuan, as well as the Beijing Winter Olympics venues.
About 140 million Chinese have opened digital yuan accounts as of October 2021. In addition, the service has accumulated 62 billion yuan in transactions, the equivalent of 9.7 billion USD.
However, there is not much incentive for Chinese consumers to switch to the new service as existing platforms such as Alipay and WeChat Pay are already very popular in China. For comparison, Alipay had 1.3 billion users as of July 2020.
And in an effort to entice new users, Chinese officials have given away digital yuan to people through a lottery.
The digital yuan is considered an alternative to traditional money, but it is not a cryptocurrency. Because it’s not decentralized and doesn’t work on the blockchain. While it offers some level of security and privacy, it still allows Chinese authorities to manage illegal transactions.