As China has maintained the world's most stringent regulations on cryptocurrencies, recent movements in Shanghai have shown signs of changing its existing stance on stablecoins.
According to Reuters, the Shanghai State-owned Assets Supervision and Administration Commission (SASAC) recently held a meeting to discuss policy responses to stablecoins and digital currencies. Immediately after the meeting, SASAC Director Hu Qing proposed through the authority's official account that "we need to enhance sensitivity to new technologies and strengthen research on digital assets".
This initiative is interpreted as a response to increasing requests from experts and large enterprises in China to develop stablecoins pegged to the yuan. It is noteworthy that the need for private stablecoins beyond the digital yuan is now being seriously discussed within China.
The People's Bank of China (PBOC) is also concerned about the global spread of stablecoins and the potential weakening of the yuan's competitiveness. Particularly, as the United States is pursuing policies to strengthen the dollar's influence through stablecoins like USDC, there is a growing perception that a corresponding response is necessary.
PBOC Governor Pan Gongxing acknowledged in an interview last June the transformative impact of emerging technologies like stablecoins on the international payment system, emphasizing the need for regulatory approval of yuan-based stablecoins. Previously, the state-owned financial newspaper Securities Times urged Beijing authorities to respond promptly, stating in an editorial on June 23 that "delaying the development of yuan stablecoins would be disadvantageous".
Meanwhile, PBOC advisor Huang Yiping suggested using Hong Kong as an experimental stage for yuan stablecoins, citing China's strict capital controls. He explained that "there is an offshore yuan market in Hong Kong, and once that market matures, issuing stablecoins linked to offshore yuan will be possible".
This discussion aligns with stablecoin projects for yuan that major private companies like JD.com and Ant Group have been preparing for years, adding weight to the possibility of actual implementation. It is interpreted as a signal that China is fully pursuing leadership in digital economy and payment systems.
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