Reviewing the Introduction of a Yuan Stablecoin

China, Considering Allowing Yuan Stablecoins

News has recently emerged that China is considering introducing yuan-based stablecoins. Why has China, which once banned cryptocurrency trading entirely, changed its stance?

 

Checking Dollar Hegemony

The current global financial order still revolves around the US dollar. 

The cryptocurrency market is no exception.

 

Just looking at the stablecoin market, dollar-based stablecoins account for an overwhelming share.

If this trend continues, in a future where cryptocurrencies are fully commercialized, China will have no choice but to be subordinated to the US financial system and regulations without gaining any leadership. In the end, there is a risk of falling behind in the race for digital asset hegemony without even mounting a challenge.

 

Why Has It Blocked Stablecoins Until Now?

It is not that China was unaware of this.

Nevertheless, the reason it has been reluctant to introduce stablecoins until now is 

that it was already running its own digital currency, e-CNY(digital yuan) , which it had been developing·operating.

 

e-CNY is issued by the People's Bank of China(PBoC) as a central bank digital currency(CBDC), 

which allows the state to monitor and control transactions in real time. 

Stablecoins, on the other hand, are designed on a blockchain basis, 

which makes direct control by the authorities relatively difficult.

 

That is why China has prioritized ‘controllable digital currency’ and 

pursued a comprehensive crackdown on cryptocurrencies and a de-dollarization strategy centered on e-CNY .

 

A Changed Situation, A Changed Strategy

However, as time has passed, the potential uses of stablecoins have grown even greater.

This is because in international transactions they can be used far more flexibly than e-CNY, and above all, they can check the influence of dollar stablecoins. From China's perspective, stablecoins have become a new tool it can use to internationalize the yuan.

 

Experimenting Through Hong Kong

China plans to use Hong Kong as a testbed first.

This is because Hong Kong is an international financial hub whose financial system is connected to the mainland, and a region where regulatory experiments are possible. If yuan stablecoins successfully take root in Hong Kong, they could spread to the mainland and overseas and become a stepping stone for expanding global use of the yuan.

 

 Stablecoins Within a Long-Term Strategy

Experts forecast that within the next 5 years, the stablecoin market will grow to a size of several trillion dollars. By participating in this huge market, China aims to expand its position in the race for financial hegemony with the US, and strengthen the yuan's presence.

 

In other words, this review of allowing stablecoins can be seen not as a simple policy change but as a long-term strategy aimed at economic·financial security

 

China's moves, which we briefly looked at in this article, are not simply ‘foreign news’ but,

an important signal for us as well.

 

This is because it means digital assets are increasingly entering the regulated financial system, and have begun to be used as tools 

in hegemonic competition between nations.

 

Therefore, individual investors also need to become familiar with cryptocurrencies and the digital financial environment.

 

At maruLab, you can easily learn concepts through a variety of quizzes and learning content, and experience real market trends with various mock investment products; through this process, you can naturally get closer to the market, and prepare one step ahead in the changing global financial order.