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China’s tech giants push for yuan stablecoin to challenge USDT

China’s tech giants push for yuan stablecoin to challenge USDT
Jacob LazurekJacob LazurekCoinpaprika

JD.com and Ant Group are urging China's central bank to approve a yuan-pegged stablecoin in Hong Kong to counter USDT's dominance in global trade.

JD.com and Ant Group are lobbying the People's Bank of China to authorize a yuan-based stablecoin in Hong Kong, aiming to reduce reliance on US dollar-backed digital currencies. Both companies plan to issue Hong Kong dollar-backed stablecoins when new regulations take effect on August 1, but argue that a yuan-pegged version is essential for promoting the yuan's international use.

Currently, over 99% of stablecoins are tied to the US dollar, with Tether's USDT holding a 68.2% market share. Chinese exporters increasingly use USDT for international payments, bypassing currency risks and capital controls.

Despite China's 2021 ban on cryptocurrencies, policymakers are showing interest in stablecoins for cross-border payments. Hong Kong's upcoming Stablecoin Ordinance provides a regulatory framework, allowing companies like JD.com and Ant Group to apply for licenses.

If approved, a yuan-pegged stablecoin could mark a significant shift in China's approach to digital assets and enhance the yuan's role in global finance.

Author

Jacob Lazurek

Jacob Lazurek

Coinpaprika

In the dynamic world of technology and cryptocurrencies, my career trajectory has been deeply rooted in continuous exploration and effective communication.

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