An industrial park built to promote China's central bank digital currency (CBDC) has settled in Shenzhen. The Chinese megacity revealed a number of financial firms had already relocated there while announcing over a dozen efforts to increase the use of the digital yuan in the area.
Shenzhen will invest $14 million over the course of three years to create the digital yuan ecosystem.
For the purpose of developing China's CBDC, the city of Shenzhen, a hub for technology, industry, and finance in the Chinese Guangdong province, has opened the nation's first business and industrial park.
According to the China Internet Information Center (China.org.cn), the city's Luohu district is home to the digital yuan (e-CNY) park. According to the government-run portal, nine financial firms have already opened operations there, including the fintech platform Lakala Payment.
Ten projects were announced by the district government to support the growth of the regional digital yuan ecosystem. Over the next three years, a total of 100 million yuan ($13.7 million) would be devoted to the plan's execution.
Ten projects were announced by the district government to support the growth of the regional digital yuan ecosystem. Over the next three years, a total of 100 million yuan ($13.7 million) would be devoted to the plan's execution.
The money will be utilized to facilitate payment solutions across multiple businesses, boost the digital economy sector, encourage e-CNY operations, and promote the usage of smart contracts. The Luohu financial services department's head, Huang Tuo, said:
The opening of China's first such park represents a crucial turning point in the growth of the country's digital currency.
China started testing the digital yuan in 2019 as a pilot project. Since then, 26 cities have joined the trials, and as of 2022, 5.6 million shops will accept the CBDC. The overall number of e-CNY transactions hit 950 million by the end of June this year, totaling 1.8 trillion yuan.
To create an e-CNY industrial cluster, the Luohu park's developers want to draw branches of commercial banks that operate with the system and other specialist organizations. Digital yuan startups are eligible for incentives worth up to 50 million yuan. According to the article, any businesses establishing a presence in the park will be eligible to apply for loans with low interest rates and benefit from rent-free space for up to three years.
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