While that marks some progress following two years of trials, it's still far from mounting a serious challenge to privately owned digital payment apps.
Ant Group, for example, revealed in 2020 stock exchange filings that its Alipay app processed $1.6 trillion on average each month — more than a thousand times the digital yuan's monthly transaction volume.
After initially limiting usage of digital yuan wallets to winners of a lucky draw, the Chinese government has been making it easier for the public to try virtual money. At the start of this year, for example, the People's Bank of China released a wallet app on Apple and Android stores that can be used in 10 cities and regions that are piloting the currency, along with the Olympic venues.
That pilot app is now available to everyone in those areas, not just the lottery winners.
The central bank has touted surging numbers among its trial users last year as a sign of the digital yuan's success. By the end of December, the app had been downloaded by 261 million individuals, or 19% of China's population, according to central bank data.
But there are still barriers to using the money, too. Outside of the Olympics exemption for foreigners, people who want to trade with digital yuan need to download and sign up for the central bank app, and then add money from their accounts at one of the designated Chinese banks.
The currency also can't be used outside of the 10 cities and regions that are piloting it, along with the participating Olympics venues.
Consumers appear to have an "unwillingness to embrace" the currency right now, according to Frank Xie, a professor at the University of South Carolina Aiken who studies Chinese business and the economy.
Experts cited a lack of incentives as a major reason for the lack of enthusiasm.
"The ecosystems that have been built now for a decade around the big tech firms are unbeatable in terms of network and convenience," said Martin Chorzempa, a senior fellow focusing on Chinese financial innovation and technology at the Peterson Institute for International Economics. After all, industry leaders Alipay and WeChat Pay already have hundreds of millions of users who are familiar with their services.
"The payment experience does not tend to strike most users as any different or better than what is already on offer," he added.
Xie also suspected that concerns about a loss of privacy could be a factor, adding that "even ordinary citizens" have come to realize the reach of the government's power.
Changing spending patterns
The government does have some options for pushing consumers to change their spending patterns, according to Singleton of the Foundation for Defense of Democracies.
"Over time, it is possible people could see increased adoption of the digital yuan to pay for certain expenses, like utility bills, transportation or other government-managed bills, simply because the government could force those changes upon consumers," he said.
Analysts have also raised the possibility that the government could request that privately-owned apps actively promote the state-backed yuan. That's already starting to happen: Alipay began trialing digital yuan payments last year, and Tencent said earlier this month that it would also start supporting the digital yuan in its WeChat Pay wallet.
"In effect, you are asking these providers to potentially cannibalize their own systems by allowing customers to use the digital yuan instead of their own existing payment options," said Kimmo Soramäki, founder and CEO of London-based analytics firm Financial Network Analytics.
Those companies might feel as if they have little option, though. China's push into digital currency dovetails with its regulatory crackdown on Big Tech. Ant Group and Tencent (TCEHY) have been under intense scrutiny and were forced to either overhaul their businesses or pay big fines as Beijing sought to curb their power.
"The rollout of future versions of AliPay and WeChatPay [is] likely to be forestalled, which in turn will limit the power wielded by these major tech firms," said Singleton, who added that the government is hoping that its regulatory hurdles will allow the digital yuan to "overtake these other payment systems."
However, Beijing eventually secures wider adoption of its state-backed digital currency, there does appear to at least be one certainty: The Beijing Winter Olympics isn't shaping up to be the stage for digital yuan bragging rights that authorities might have hoped for.