Breaking: China Considers Yuan-Backed Stablecoins to Rival Dollar Dominance
China is making a U-turn on its stance on cryptocurrencies as it looks to approve the issuance of Yuan stablecoins. The country considers this initiative as being key to rival the dollar’s dominance as the U.S. continues to warm up to dollar-backed stablecoins.
China Eyes Yuan Stablecoins For Global Adoption
According to a Reuters report, the Asian country is considering allowing the issuance of yuan-backed stablecoins for the first time as it looks to boost global adoption of its currency. This represents a major turnaround in the country’s stance on cryptocurrencies.
In line with this, the State Council, China’s cabinet, will review and possibly approve a roadmap later this month for the creation of these Yuan stablecoins in a bid to catch up with the U.S. push on stablecoins.
China had in 2021 banned crypto trading and mining, a move which had set the country back, having made headways in the crypto space. Now, the government is looking to play catch-up with the U.S., seeing as the Donald Trump administration has further advanced the crypto industry in the country with regulatory clarity.
This includes Trump’s signing of the GENIUS Act last month, which became the first major crypto legislation in the U.S. and coincidentally regulates stablecoins. Now, China will look to replicate this by providing guidance on Yuan stablecoins.
According to the report, China’s roadmap will target the usage of its currency in the global markets and outline the responsibilities of domestic regulators. It will also include guidelines on risk prevention.
Furthermore, during the State Council meeting, the country’s senior leaders are likely to deliver speeches that make a case for these Yuan stablecoins and also define the boundaries of their application and development in business.
This move could spark the use of stablecoins among companies and businesses in the country, similar to what is happening in the U.S. Since the passage of the GENIUS Act, traditional finance (TradFi) giants such as JPMorgan and Bank of America have begun exploring stablecoin use. Meanwhile, BlackRock described stablecoins as the ‘Mega Force’ in finance’s future.
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