This is the CBDC play. Give consumers a nice interest rate, coupons or bonuses to onboard. In China the average person doesn't seem to have much concern for privacy so I think it has a chance of working if the interest rate is high enough.
Not just that, they are actually desperate to jump-start their economy and sustain the bubble by monetary stimulus, so the new high interest rate (credited to the wallet, just numbers on a screen, no need of even paper and ink to print) would be an ideal channel for monetary policy transmission. A Keynesian's wet dream.
This is the CBDC play. Give consumers a nice interest rate, coupons or bonuses to onboard. In China the average person doesn't seem to have much concern for privacy so I think it has a chance of working if the interest rate is high enough.
If the interest is not coming from borrrowers who pay interest then it is just numbers on a mobile screen, in other words, monetary stimulus.
The control and surveillance gains would be totally worth it for them.
Not just that, they are actually desperate to jump-start their economy and sustain the bubble by monetary stimulus, so the new high interest rate (credited to the wallet, just numbers on a screen, no need of even paper and ink to print) would be an ideal channel for monetary policy transmission. A Keynesian's wet dream.
Setting the Chinese up for an epic rugpull of the century (like what Nixon did last century) 🤣