Starting next month, public sector personnel in the Chinese city of Changshu will receive their salaries in digital yuan, as part of China’s central bank digital currency (CBDC) rollout. This new initiative will affect employees such as doctors, instructors, and journalists in the city, which is home to more than 1.5 million people and is less than 160 kilometers from Shanghai.

Changshu, according to the South China Morning Post, is the most recent Chinese city to recruit public sector employees for the CBDC implementation. This development follows a December 2018 CBDC airdrop in which 3 million digital yuan worth $3 million were distributed to 10,000 Suzhou residents.

In recent years, the Chinese government has increased its efforts to promote the use of its digital yuan, also known as the Digital Currency Electronic Payment (DCEP) system. The DCEP is viewed as a means to reduce the country’s reliance on the U.S. dollar and other foreign currencies in cross-border transactions and to promote financial inclusion and transparency.

While China has been at the forefront of CBDC adoption, other nations are also investigating the technology. According to the Atlantic Council’s CBDC tracker, only eleven countries, including the Bahamas, have entirely launched a CBDC, but the technology is gaining ground worldwide.

However, the introduction of CBDCs has raised privacy, surveillance, and financial stability concerns. Critics assert that digital currencies sponsored by central banks could allow governments to monitor and control the financial transactions of citizens, thus violating their privacy. In addition, they note that CBDCs could pose a threat to financial stability if not properly designed and implemented.

Despite these concerns, CBDCs appear to be gaining traction, with more nations and cities investigating the technology’s potential applications. In the future years, it remains to be seen how CBDCs will develop and how they will affect the global financial landscape.