How does China’s digital yuan work?

HONG KONG (Reuters) – China on Sunday concluded its largest pilot project to date for a central bank-backed digital yuan, with analysts saying the trial extended its lead in the global race to develop a central bank digital currency (CBDC).

Under the trial programme, the central bank distributed “red envelopes” – a reference to China’s traditional way of gifting cash – in the form of online wallets containing 200 digital yuan ($29.75) each to 50,000 randomly selected consumers.

Below are details of how China is working to develop its digital currency:

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