Written by: Oliver, Mars Finance
Midnight Announcement and That 5000 USD Green Candle
At midnight on July 11, 2025, a seemingly ordinary official WeChat public account push caused a huge wave in the cryptocurrency community in China and globally. The publisher was the Shanghai State-owned Assets Supervision and Administration Commission, discussing a central group learning conference held on July 10, focusing on "Development Trends and Response Strategies of Cryptocurrencies and Stablecoins".
As soon as the news broke, the market responded in the most direct and primitive way. In the following hours, Bitcoin price soared from around $111,300 to over $118,400, drawing a massive green candle of over $7,000 and creating a new historical high. Accompanying the price surge was dramatically amplified trading volume, clearly indicating that a powerful purchasing force was instantly activated. The most sensitive nerve in the cryptocurrency market has always been "policy sentiment".
This raises a core question: Why could an internal learning conference of a local state-owned assets management department trigger such violent price fluctuations in top global crypto assets? What subtle implications did the "smart money" in the market read from this brief announcement? The answer lies not on the text's surface, but deeply embedded in China's complex attitude towards cryptocurrencies over the past decade, Hong Kong's unique role as a financial special zone, and the grand narrative of digital finance's future. The market is trading not the conference itself, but the potential strategic shift it implies.
[The translation continues in the same professional and accurate manner for the entire text.]Over the past two years, Hong Kong has built a comprehensive digital asset regulatory system at an astonishing speed. It launched a mandatory licensing system for Virtual Asset Service Providers (VASP), imposing strict requirements for anti-money laundering (AML) and investor protection comparable to traditional financial institutions. In June 2025, Hong Kong officially announced the "Stablecoin Issuer Regulations Draft" and planned to implement it on August 1st, paving the legal path for compliant stablecoin issuance. More significantly, in February 2025, the world's most influential crypto conference Consensus chose Hong Kong, a city outside North America, for the first time in over a decade, attracting nearly 10,000 global practitioners. Financial Secretary Chen Maobo personally delivered a speech, declaring "Hong Kong is back, Web3 is back".
Hong Kong's openness and Shanghai's exploration formed a perfect strategic synergy. The CNHC (offshore RMB stablecoin) conceived by Shanghai would undoubtedly find its ideal issuance location and testing ground in Hong Kong. By issuing through licensed institutions regulated by the Hong Kong Monetary Authority, CNHC could compete globally with USD stablecoins, while potential financial risks would be absorbed by Hong Kong's mature regulatory system and independent financial firewall, without directly impacting the mainland. This is the essence of the "One Country, Two 'Cryptos'" strategy. It allows China to simultaneously achieve two seemingly contradictory goals: maintaining financial system stability and strict capital controls on the mainland, while actively participating in global digital financial innovation and competition, vying for the discourse power of the next-generation internet.
Top-Level Design Game: Another Voice Beyond the Shanghai-Hong Kong Model
However, the Shanghai-Hong Kong "sandbox" model, though ingenious and prudent, has sparked deeper strategic contemplation. One perspective argues that this approach focusing on offshore markets and limited pilots might not fully leverage China's core scale advantage as the world's second-largest economy. In the comprehensive digital financial competition with the United States, relying solely on Hong Kong as a "special zone" window might be insufficient to form overwhelming competitiveness.
This voice calls for China to fundamentally review and define the virtual capital market from a more grand national perspective. The core is to directly face and distinguish two fundamentally different financial needs: "investment" and "gambling" categories. Stablecoins, in their view, are closer to a gambling-type financial market investment chip, primarily serving high-frequency trading and risk hedging, rather than direct payment or value storage. Avoiding its "gambling" attributes is tantamount to burying one's head in the sand.
Based on this understanding, a bolder blueprint emerges. In this conception, Shanghai and Hong Kong would play distinctly different yet complementary roles. Shanghai, as China's economic heart, should focus on constructing the "investment" virtual capital market. Its core task is to vigorously promote digital RMB (e-CNY), serving the digital transformation of the real economy, providing a financing platform based on real assets and future rights for massive enterprises, families, and individuals, completely stripping away pure financial gambling functions. Hong Kong, meanwhile, should be developed into a strictly regulated, internationalized "gambling-type" financial virtual capital market. Here, compliant RMB stablecoins will serve as one of the core trading mediums, directly confronting USD stablecoins, providing a credible "RMB solution" for the global virtual economy.
To realize this grand blueprint, infrastructure must lead the way. The concept of establishing a "China Digital Network" company similar to the "State Grid" has emerged. This company will be responsible for building a world-class blockchain underlying platform, ensuring convenient, secure, efficient, and low-cost transactions. Simultaneously, clarifying the role of state-owned financial capital is crucial. They should not participate as ordinary players in market competition but should undertake the "national team" mission, focusing on strategic investments executing national will, such as saturated angel round investments in critical technological fields or serving as the ultimate stabilizer when markets fail.
Two Futures of the New Chessboard
When we interweave all clues and perspectives, the Shanghai State-owned Assets Supervision and Administration Commission's learning session transcends a single policy signal. It's more like a crossroad signpost pointing to two possibilities for China's digital financial strategy.
The first future is the current incremental path represented by Shanghai-Hong Kong linkage. It is cautious and pragmatic, carefully extending tentacles through "electronic enclosures" and offshore experimental fields, attempting to open a new path for RMB internationalization and RWA under strict risk control without changing the existing domestic financial landscape. This is the wisdom of "crossing the river by feeling the stones", aiming to accumulate small victories into a grand triumph.
The second future involves a more profound, top-down systemic transformation. It requires decision-makers to recognize the binary attributes of virtual capital, strategically dividing the market into "investment" and "gambling" categories, allowing Shanghai and Hong Kong to perform their respective duties, supplemented by national-level digital infrastructure construction. This is undoubtedly a larger chess game, intending to complete the mission in one stroke, not just participating in the game but reshaping its rules.
Therefore, today's market green candle that surged 7,000 USD contains emotions far more complex than imagined. It is not just an instant pricing of the "openness" signal but an intense game and imagination about which path China will choose in the future. Traders are betting on the possibility of the world's second-largest economy transforming from a "strict regulator" in the crypto world to a "controlled participant", and ultimately becoming a "rule-maker". The midnight announcement might not be a starting gun but the opening bell of this grand chess game concerning China's digital financial national destiny.
