Several areas of China have reportedly airdropped free digital yuan to residents to revitalise an economy decimated by COVID-19.
China adopted a zero-tolerance approach to stemming the coronavirus through repeated lockdowns.
Xiong’an New Area distributed 50m of the state-owned cryptocurrency (e-CNY) with the aim of rebuilding and boosting its economy, while the city of Shenzhen plans to airdrop 30m digital yuan for the same reason.
Guangzhou’s Nansha District revealed that it would send out 10m in red packets – a Chinese gifting tradition – to the catering and retail industries.
The currency can be spent at more than 15,000 in-app merchant terminals – but there are plans to ban its use in the United States.
A newly introduced Bill to the US Senate by senators Tom Cotton, Mike Braun and Marco Rubio seeks to prevent apps from allowing its integration if sold through app stores. The App Store and Google Play, for example, would have to ban the likes of WeChat.
“The Chinese Communist Party will use its digital currency to control and spy on anyone who uses it,” said Senator Cotton. “We can’t give China that chance — the United States should reject China’s attempt to undermine our economy at its most basic level.”
Senator Rubio added: “This is a major financial and surveillance risk that the United States cannot afford to make.
The Chinese embassy in Washington responded: “Another example of the United States wantonly bullying foreign companies by abusing state power on the untenable ground of national security.”