Chinese State Media Urges Active Push for Yuan-Based Stablecoin

"Abandoning Stablecoins Means Missing Out on New Opportunities"

As countries including the United States are moving rapidly to institutionalize stablecoins, Chinese state media has called for an active push for a yuan-based stablecoin.

Securities Times, a publication under the People’s Daily, the official newspaper of the Communist Party of China, reported on June 23 under the headline, "We Must Actively Promote the Internationalization of the Yuan by Adapting to the Stablecoin Trend." Stablecoins are cryptocurrencies that peg their value to specific assets in order to minimize price volatility.

Banknotes of US Dollar, Euro, Chinese Yuan, etc. Photo to aid article understanding. Reuters Yonhap News.

Securities Times emphasized that the wave of stablecoins is sweeping across the globe and has emerged as a critical issue that countries must urgently address. The publication stated, "For China, which seeks to strengthen the international status of the yuan, actively managing and supervising stablecoins and accelerating the internationalization of the yuan may be a better solution."

The outlet also warned that allowing stablecoins to develop disorderly in regulatory blind spots would have a negative impact on the national financial system, adding, "Abandoning an efficient payment method (stablecoins) would mean missing out on new opportunities for currency globalization."

Securities Times noted that the unique advantages and potential risks of stablecoins as a new payment method cannot be ignored. The report also included comments from experts and industry insiders stating that it is better for China to develop a yuan-based stablecoin sooner rather than later.

This call from Chinese state media comes as experts increasingly warn that the United States’ push to enact stablecoin legislation could further expand the influence of the US dollar. On the same day, analysts at China International Capital Corporation (CICC) stated in a report, "Stablecoins will reduce the capital and time costs of US dollar settlements, making cross-border transactions more convenient and ultimately expanding the use of the US dollar."

Recently, countries have been actively moving to institutionalize stablecoins. The GENESIS Act, which brings stablecoins into the regulatory framework, passed the US Senate, and major countries such as South Korea and the United Kingdom have included stablecoin legislation in their plans since May. Hong Kong is set to implement a law allowing stablecoin issuance starting in August, but cryptocurrency trading remains legally prohibited in mainland China.