CMC News

#China Eyes #Yuan-Backed #Stablecoins for Global Trade Push

China's State Council is reviewing plans to introduce yuan-backed #stablecoins as part of a strategy to expand the currency's role in international trade and payments. This marks Beijing's first consideration to allow regulated stablecoins, shifting from its previous focus solely on the central bank's digital yuan.

The proposal aims to compete with dollar-pegged tokens like $USDT and $USDC, which currently dominate the $279 billion stablecoin market. Policymakers see potential in 24/7 settlement capabilities and low transaction costs that stablecoins offer for cross-border payments.

The yuan's share of global payments dropped to 2.88% in June, its lowest in two years, while the dollar maintains roughly 47% market share, according to SWIFT data. President Trump's embrace of stablecoin regulation through the GENIUS ACT adds pressure on China to clarify its digital asset stance.

Officials remain cautious about investor speculation and illicit finance risks. Earlier this month, authorities moved to limit stablecoin promotion on the mainland, while #Shenzhen flagged fraud concerns around fiat-pegged tokens in July.