China Cautiously Considers Renminbi-Backed Stablecoins to Internationalize Currency

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China is looking to “allow the launch of its first stablecoins” to internationalize the renminbi and challenge the dominance of the US dollar, according to a report by the FT. 

While Chinese policymakers see the potential of stablecoins to boost the renminbi’s global use, given the success of US dollar-backed tokens, the central bank remains concerned about capital outflows and maintaining central control. These concerns come as the United States advances its own regulatory framework for cryptocurrencies and stablecoins with measures like the GENIUS Act.

People’s Bank of China Governor Pan Gongsheng acknowledged that stablecoins have “fundamentally reshaped the traditional payment landscape,” with discussions on how stablecoin initiatives need to align with China’s national conditions and guard against capital outflows and money laundering.

The Hong Kong Monetary Authority (HKMA), which allows regulated crypto activities unlike mainland China, has recently introduced a stablecoin licensing regime to allow a controlled roll-out of licensed providers. This effectively gives China a regulatory sandbox to test renminbi-backed stablecoins, without relaxing restrictions on the mainland.

Only a handful of initial licences will be granted in 2026, with various Chinese state-owned companies expected to apply for licensing. Tech giants like Ant International have previously lobbied the Chinese central bank to allow for renminbi-backed stablecoins in Hong Kong and have already announced plans to apply for stablecoin licenses.

One of four Chinese state-owned banks will also receive a stablecoin license.