🇨🇳 China Prepares a Major Shift in Crypto Policy
Reuters reports that Chinese authorities are considering launching yuan-pegged stablecoins to strengthen the national currency's position on the global market. If approved, this would mark a significant policy reversal after the ban on crypto trading and mining in 2021.
Key Highlights:
🟡 China's State Council will review the roadmap by the end of August.
🟡 The plan includes using yuan-backed stablecoins for international settlements and cross-border trade.
🟡 Hong Kong and Shanghai are set to become priority hubs for the rollout.
🟡 The topic will be discussed at the SCO Summit in Tianjin, Aug 31 – Sept 1.
Context:
🟡 Currently, 98% of the stablecoin market is dominated by USD-pegged tokens.
🟡 China aims to reduce dependence on the U.S. dollar and promote the yuan as a competitive global currency.
🟡 This move also responds to the U.S. push for dollar-backed stablecoins under Donald Trump's administration.
Why It Matters for the Market:
🟡 Yuan-backed stablecoins could create a new liquidity class in Asia and shift the balance of power in global settlements.
🟡 Strengthening the yuan’s role in international payments could challenge dollar dominance and accelerate de-dollarization.