- JD.com and Ant Group want stablecoins pegged to offshore yuan to counter growing global influence of U.S. dollar-based digital assets.
- Both firms plan stablecoin issuances under Hong Kong’s upcoming law and argue offshore yuan tokens will aid currency internationalisation.
- Industry voices warn yuan could fall behind if cross-border payments don’t match efficiency and reach of dollar-backed stablecoins.
China’s tech giants JD.com and Ant Group are pressing the People’s Bank of China (PBOC) to approve yuan-based stablecoins. Their goal is to launch stablecoins pegged to the offshore yuan in Hong Kong to challenge the rising influence of dollar-linked digital assets.
Push for Offshore Yuan Stablecoins
JD.com and Ant Group, a financial affiliate of Alibaba, are in closed-door talks with regulators in China. According to Reuters both companies are pushing for stablecoins backed by the offshore yuan. The two firms say they need the digital tokens in order to enhance the yuan’s standing on the world stage.
Reuters quoted individuals with direct knowledge of the talks, stating, “JD.com has argued that offshore yuan stablecoins are urgently needed as a tool to promote yuan internationalisation.”
These stablecoins would be introduced in Hong Kong under new legislation taking effect on August 1. JD.com and Ant are already planning to issue stablecoins tied to the Hong Kong dollar, but the push for yuan-pegged alternatives reflects a broader strategy.
The push comes as U.S. dollar stablecoins continue to expand globally, dominating digital payments and international transfers. By backing yuan-based tokens, the companies seek to strengthen China’s presence in digital finance.
Beijing’s Crypto Stance May Shift
The success of these lobbying efforts would reflect a possible change in the policies of the world’s most restrictive government towards cryptocurrencies. While China banned crypto activities back in 2021, the development of stablecoins that ties into national interests could present a restrained avenue of digital expansion.
Industry leaders are voicing similar concerns. Wang Yongli, co-chairman of Digital China Information Service Group and former vice head of Bank of China, shared on his social media account, “The global expansion of U.S. dollar stablecoins is posing fresh challenges to yuan internationalisation.”
He further warned, “It would be a strategic risk if cross-border yuan payment is not as efficient as dollar stablecoins.”
These statements highlight the growing belief among Chinese financial experts that failing to act could place China at a disadvantage in digital payments.
Hong Kong Eyes Competitive Advantage
Hong Kong is working to establish itself as a digital asset hub, competing directly with the United States in setting clear regulatory frameworks. The proposals from JD.com and Ant Group are aligned with this broader ambition.
If accepted, the yuan-based stablecoin would benefit international and cross border payments using blockchain systems providing low cost, 24/7 transfers. This would enable them as an alternative to banking rails and U.S. dollar backed digital currencies.
The regional support from Hong Kong’s government combined with pressure from leading tech firms may be key in reshaping China’s digital currency strategy while accelerating yuan usage beyond its borders.
