It is no longer a new thing that various states have started to adopt a digital form of currency, usually based on their official currencies to be used for various financial transactions in digital platforms. But recently, one major economic superpower has made the breakthrough step to make a digital version of its official currency.
The powerful nation to make such a move is China, thanks to the creation and mass implementation of the digital yuan, which has been used in some of the major cities in the country. If you are now planning to switch to this revolutionary form of currency and know its difference from cryptocurrency, whether you are a professional or a business or company owner, you should read on.
Knowing More About Digital Yuan
Digital yuan, or what they refer to as the yuan coin, is a new type of digital currency that shares some certain characteristics with a cryptocurrency, such as Bitcoin. Based on the actual yuan currency, the digital yuan has a lot of properties that can be found on the yuan currency itself. In other words, the digital yuan is the digital counterpart of the yuan currency in the physical form.
Just like the physical currencies, the digital yuan also comes in a set of different tokens with values and identifiers, which has a very close resemblance to the values and identifiers used in physical banknotes.
And just like physical yuan currency, digital yuan currency is also issued by the central bank of China, which also has the responsibility of backing and regulating the circulation and use of the digital yuan currencies.
The digital version of the yuan has been in commercial use nowadays, starting its full operational use in early 2020. This started when the central bank did a massive airdrop of digital tokens worth millions of digital yuan to lucky citizens who got to look forward to it. And to continue the growing number of digital yuan users, the said airdrop activity is still ongoing up to this day, so you better not miss it.
Digital Yuan vs. Cryptocurrency
Since the yuan coin has a number of properties that can be found in cryptocurrencies, people would be quick to assume that the digital yuan is classified as a cryptocurrency as well. However, there is still a lot of differences between the digital yuan and the cryptocurrency which famously includes Bitcoin.
First of all, digital currency such as the digital yuan is being operated and regulated by a central bank or authority, ensuring that no questionable activities regarding the handling of the currency will be done.
On the other hand, cryptocurrencies such as Bitcoin and Ethereum are always there and ready to serve, since they are highly decentralized in the system, will not have a hard time making transactions from one person to another.
Also, there will not be any central bank or authority that will govern the regulation of cryptos, but the transaction will surely be less secure. This is why you better make use of digital currency for am easier, faster, more secure, and more convenient transactions.