Does China have stablecoins? That’s no longer an idle question. For years, the official stance in Beijing has been one of suppression: cryptocurrencies banned, private token issuances tightly controlled, and digital-asset experiments limited. But recent shifts suggest China is rethinking parts of this policy — especially in relation to stablecoins pegged to the yuan. In this article, we analyse what is known so far, what’s changing, what risks remain, and what the future may hold.
What Has Been China’s Past Stance?
Cryptocurrency Ban & CBDC Focus
- Since 2021, Mainland China has banned most cryptocurrency trading and mining over concerns about financial stability, capital flight, fraud, and speculative risk.
- At the same time, it has pushed ahead with its central bank digital currency (CBDC), the digital renminbi (also known as e-CNY), which is centrally issued by the People’s Bank of China (PBoC). This is legal tender within China, and by design it is tightly controlled.
No Private Stablecoins — Until Now
- Private stablecoins (especially dollar-pegged ones) have existed in usage, often in offshore trade or via Hong Kong, or via digital asset exchanges used by Chinese exporters. They are not officially authorised in Mainland China.
- Regulatory bodies have repeatedly instructed brokers and research institutions to halt publishing about stablecoins or endorsing them, citing risk of fraud and unverified speculation.
What’s Changing?
Recent months have seen several indicators that China is preparing to allow certain types of stablecoins — but under strict limitations and perhaps only for international / offshore usage.
The Yuan-Backed Stablecoin Proposal
- According to Reuters, China is considering allowing yuan-backed stablecoins as part of a broader roadmap to internationalise the yuan. The plan may include guidelines for risk prevention and assign implementation roles to places like Hong Kong and Shanghai.
- This would be a major reversal from prior policy, if implemented.
Examples & Early Moves
- A new stablecoin called AxCNH was launched recently, pegged to the offshore yuan (CNH), and intended for cross-border transactions, particularly along Belt & Road Initiative corridors. It is overcollateralised and regulated. AnchorX is behind this project.
- Hong Kong has enacted a Stablecoin Ordinance (effective August 1, 2025) that requires stablecoin issuers to be licensed by the Hong Kong Monetary Authority, with strict reserve requirements. This includes stablecoins pegged to the Hong Kong Dollar and potentially the offshore yuan.
Regulatory Signals & Constraints
- Despite interest, Chinese regulators remain cautious. They continue to issue guidance to limit stablecoin endorsements, curb publicity and research, especially in Mainland China.
- The fear of capital flight remains central. Stablecoins, especially if able to move freely across borders, can undermine China’s tight controls on foreign exchange flows.
Current Reality: Do Stablecoins Exist Yet in China?
So, does China have stablecoins in a full, authorised, domestic sense? The answer is: not yet — at least not in the way that many stablecoins operate elsewhere (i.e. private, freely traded, fiat-backed tokens within domestic market, etc.).
- The digital yuan (e-CNY) is not a stablecoin in the usual private sense; it is a state-issued CBDC, centrally managed, not privately backed, and operates under China’s regulatory control.
- Private or offshore yuan stablecoins (like AxCNH) are emerging, but they are largely for cross-border trade, limited in scope, and subject to strong regulatory oversight.
- In Hong Kong, legal frameworks have been set up to allow stablecoins (including yuan or CNH pegged ones), but as of now licences are pending or only just being issued. Mainland Chinese firms that want to participate may face restrictions.
Potential Benefits & Risks
Benefits
- Yuan internationalization: Allowing yuan-backed stablecoins could help promote the renminbi in cross-border trade, reducing dependence on U.S. dollar stablecoins.
- Efficiency in payments: Cross-border remittances, trade settlements, and financial infrastructure may become faster, cheaper, more transparent.
- Regulatory oversight: If state-sanctioned, stablecoins can be structured to include KYC / AML controls, real-time monitoring, limit leaks and illicit finance.
Risks
- Capital flow control: China’s foreign exchange controls are central to its economic policy. Stablecoins could undercut those controls if used to move value outside approved channels.
- Financial stability: Private issuers’ backing of stablecoins must be credible. Poorly collateralised or mismanaged stablecoins pose risks of runs, fraud, or quick devaluation.
- Regulatory abuse or operational risk: Misuse, governance issues, technological vulnerabilities, or even regulatory overreach could hamper adoption or trust.
How China’s Approach Differs from Other Jurisdictions
- In the U.S., legislation such as the GENIUS Act has been passed that creates clearer pathways for stablecoin issuers and frames the regulation of dollar-pegged stablecoins.
- Hong Kong’s regime aims to be more open, allowing for licences and stablecoins pegged to different fiat currencies, including its own and potentially offshore yuan. But there are limits, and initial rollouts are cautious.
- China’s use of CBDC is more advanced in domestic implementation than many countries, but that comes with a trade-off: central oversight, limitations on anonymity, and strictly controlled scope.
FAQ: Does China Have Stablecoins?
Here are some frequently asked questions, each worded with the focus keyword for clarity:
Q1. Does China have stablecoins authorized for domestic use?
No — as of now, China does not have authorized private stablecoins for domestic use. Domestic policy remains focused on the digital renminbi (e-CNY), a central bank digital currency. Stablecoins are being considered but are not yet fully legal or available inside mainland China’s regulated domestic markets.
Q2. Does China have stablecoins pegged to the yuan or offshore yuan (CNH)?
Yes — there are early examples, such as AxCNH, a stablecoin pegged to the offshore yuan, intended for cross-border trade and supported by regulatory frameworks in places like Hong Kong. But these are not yet widespread for everyday usage within China.
Q3. Does China have stablecoins in legal regulatory framework?
Partially. Hong Kong has instituted legislation to regulate stablecoins (licensing, reserve requirements). Mainland China is considering policy changes to allow yuan-backed stablecoins under strict regulation, but final rules are not yet fully in force.
Q4. Does China have stablecoins that challenge U.S. dollar dominance?
Potentially. The strategic motivation behind China’s move toward yuan-backed stablecoins is partly to weaken the global dominance of U.S. dollar-pegged stablecoins and enhance yuan’s role in international trade. But achieving that requires overcoming regulatory, trust, and international usage barriers.
What to Watch Next
To fully answer does China have stablecoins in a robust long-term sense, several indicators will be important:
- Legal/regulatory clarity in Mainland China, especially whether stablecoins are explicitly permitted, under what conditions, by which agencies.
- Number and scope of licenses issued (especially in Hong Kong and in free trade or special zones) for yuan (CNY/CNH) stablecoins.
- Depth of backing / reserve requirements: whether stablecoins are overcollateralised, what assets back them, how transparent and auditable reserves are.
- Use cases in cross-border trade, especially within Belt & Road Initiative, or between China and its trading partners.
- Interoperability with other payment systems, regulatory compliance (AML, KYC), and how stablecoins coexist with CBDCs and existing digital payments in China.
Conclusion & Forward-Looking Analysis
Does China have stablecoins? The answer is increasingly “yes, but with caveats.” China is on the cusp of embracing yuan-backed stablecoins — especially in offshore contexts or regulated jurisdictions like Hong Kong — but full domestic private stablecoins remain limited by regulatory, financial, and political constraints.
This shift is more than technological: it’s strategic. China views stablecoins as a lever for yuan internationalization and as a counterweight to the growing influence of U.S. dollar-denominated tokens. Yet implementing stablecoin frameworks without relaxing capital controls too much, preserving financial stability, and preventing misuse will present significant challenges.
Going forward, the real question may not be whether China will have stablecoins, but how they will be structured, where, and under what rules. If China can design stablecoins that are secure, transparent, tightly regulated, and usable in international trade without undermining its domestic financial stability, it may reshape global digital finance. If not, China risks regulatory backlash, limited use, or even financial instability.
