Summary
- Reuters reported that the Chinese government is considering permitting yuan-based stablecoins.
- It stated that this move is intended to promote yuan internationalization and respond to the growing influence of US dollar-based stablecoins.
- However, it also noted that major obstacles remain to yuan internationalization, such as strong capital controls and a low global payment share.
It has emerged that China is considering permitting yuan-based stablecoins.
On the 20th (local time), Reuters, citing informed sources, reported that "the Chinese government is considering allowing yuan-based stablecoins." As the influence of dollar-based stablecoins expands in the international payments market, China is believed to be considering the introduction of yuan-based stablecoins as part of its efforts to internationalize the yuan.
To this end, the Chinese government is expected to review and approve the 'Yuan Internationalization Roadmap' by the end of August. The roadmap is anticipated to include discussions on global yuan adoption, the responsibilities of regulatory authorities, and risk management. Notably, measures to catch up with the US's stablecoin policies are also reported to be included.
In addition, at the end of this month, senior Chinese leadership plans to hold a research meeting dedicated to stablecoins. According to sources, "statements regarding the direction of stablecoin policy and regulatory clarity may be made at the meeting."
However, major obstacles to yuan internationalization are expected to remain. According to payment platform SWIFT, the yuan's global payment share stood at 2.88% in June, its lowest in two years. In contrast, the dollar held a market share of 47.19%.
The media outlet stated, "China is one of the countries enforcing strong capital controls" and assessed that "the internationalization of the yuan may face difficulties."
Son Min
sonmin@bloomingbit.ioHello I’m Son Min, a journalist at BloomingBit
