China’s Central Bank Urges Exploration of Stablecoins for Cross-Border Payments
The People’s Bank of China (PBoC) is exploring the use of stablecoins for cross-border payments. This comes as the US prepares to pass the GENIUS Stablecoin Act, which reinforces the dollar's dominance through USD-backed stablecoins.
Key points include:
- PBoC has not officially adopted stablecoins yet due to a crypto ban but may reconsider this stance.
- PBoC Governor Pan Gongsheng highlighted that stablecoins could enhance international finance and mitigate vulnerabilities in traditional payment systems.
- Former central bank governor Zhou Xiaochuan warned that dollar-pegged stablecoins might accelerate global dollarization.
- Financial officials see potential in a yuan-backed stablecoin to elevate the renminbi's global role.
- JD.com plans to seek stablecoin licenses globally amid increasing adoption.
Morgan Stanley suggests Hong Kong could serve as a testing ground for offshore yuan-based stablecoins, helping China navigate capital controls. Robin Xing from Morgan Stanley emphasized the importance of adopting sovereign currency tokenization for digital competitiveness.
Stablecoin firms like Circle have gained traction, with projections estimating total stablecoin supply could reach $3.7 trillion by 2030.