According to reports from (Reuters), China is considering allowing the issuance of 'renminbi stablecoins' for the first time to accelerate the internationalization of the renminbi and promote its widespread use in global trade and payments. This would mark a significant shift in China's digital asset policy since it banned cryptocurrency trading and mining in 2021.

(Reuters) cited insiders who stated that the State Council of China is expected to review and possibly approve a roadmap for 'promoting renminbi internationalization' by the end of the month, covering objectives for enhancing the use of the renminbi in the global market, the division of responsibilities among various regulatory agencies, and corresponding risk prevention guidelines.

Insiders have indicated that senior leaders in China are also expected to hold a special study meeting at the end of this month, focusing on 'renminbi internationalization' and 'stablecoins'. During this meeting, senior leaders may give remarks to outline the business application scope and development direction of stablecoins.

Insiders mentioned that against the backdrop of the expanding influence of the US dollar stablecoin, Beijing views 'financial innovation', especially 'stablecoins', as an opportunity to promote the internationalization of the renminbi.

It is reported that relevant details are expected to be announced in the coming weeks, with the People's Bank of China (PBOC) and other agencies being assigned specific responsibilities, while Hong Kong and Shanghai are named as the first testing grounds for implementation.

Just last month, Shanghai financial regulators held a meeting with local officials to discuss strategies for stablecoins and digital currencies. Recently, People's Bank of China advisor Huang Yiping stated in an interview that issuing 'offshore renminbi stablecoins' in Hong Kong in the future is not impossible.

It is worth noting that Hong Kong's (Stablecoin Regulation) officially took effect on August 1, becoming the first market in the world to establish regulatory norms for stablecoin issuers, which also gives Beijing's strategic blueprint more operational space.

If the renminbi stablecoin is officially launched, it will be a significant adjustment in China's cryptocurrency policy. In 2021, Beijing completely banned cryptocurrency trading and mining under the pretext of 'maintaining financial system stability'; now it intends to embrace digital asset tools, reflecting the pressures and challenges of the international financial landscape.

For a long time, China has hoped that the renminbi could stand alongside the US dollar and the euro, becoming a major global reserve and payment currency. However, strict capital controls and annual trade surpluses of trillions of dollars have always been obstacles to achieving internationalization. Market observers point out that these restrictions may also hinder the development of renminbi stablecoins.

To make matters worse, the renminbi's status in the global payment market continues to decline. According to SWIFT statistics, in June this year, the share of international payments made in renminbi dropped to 2.88%, hitting a two-year low, compared to the overwhelming share of nearly 47% of the US dollar, highlighting a significant gap.

At the same time, the United States has taken a key step first. The Trump administration promoted the passage of the (GENIUS Act) to establish a regulatory framework for stablecoins, which also puts greater pressure on China.

  • This article is reprinted with permission from: (Block House)

  • Original title: (China considers launching 'renminbi stablecoin'! Review at the end of the month, Hong Kong and Shanghai to be the first to implement)

  • Original author: Block Girl MEL

‘Reuters: Concerned about dollar hegemony, China considers stablecoins, with Hong Kong and Shanghai as pilot cities’ was first published in 'Crypto City'