The Chinese government’s central bank digital currency (CBDC) project has not sparked much enthusiasm among the citizens of Hong Kong. In the first four days since the “digital yuan” (also known as “e-CNY”) hard wallets became accessible to residents, only 625 Hongkongers had obtained them.
As reported by a local newspaper on Feb. 28, Shenzhen installed the machines, dispensing the hard wallets for digital yuan, the first of a kind in the country. Due to the city’s unique location as a gateway from Hong Kong to mainland China, the machines were programmed to serve the citizens of Hong Kong exclusively.
The goal of the initiative, launched by the Bank of China and smart card provider Octopus Card, was to issue 50,000 hard wallets by March 31. However, in the first four days after the machines’ installation, only 625 wallets were demanded by the customers.
Even the 20% discount on purchases from 1,400 local vendors — subsidized for the CBDC owners by the government — hasn’t been a decisive factor for adoption.
However, as the Shenzhen Securities Times highlights, the local authorities will continue to promote the digital yuan for Hong Kong citizens, including the SIM card hard wallet, which would combine financial and communicational functions. The reason lies in a greater political mission to integrate the recently independent island city in the Guangdong–Hong Kong–Macao Greater Bay Area.
The adoption of e-CNY in the country is still slow, despite the Bank of China’s efforts. In October 2022, two years after the CBDC’s introduction to the market, cumulative e-CNY transactions only crossed 100 billion yuan ($14 billion). In February 2023, during the Lunar New Year period, multiple cities reportedly gave away over 180 million yuan ($26.5 million) worth of the CBDC in programs such as subsidies and consumption coupons to boost the adoption.