China Enters Global Stablecoin Race with AxCNH Yuan Token for Cross-Border Trade

Chinese Yuan Enters Global Stablecoin Market With AxCNH Launch

AnchorX has introduced AxCNH, the first regulated stablecoin pegged to the offshore Chinese yuan (CNH), aiming to streamline cross-border transactions along China’s Belt and Road Initiative.

The launch took place at the Belt and Road Summit in Hong Kong, where the company highlighted the token’s potential to improve trade settlements across Asia, the Middle East, and Europe.

An AnchorX representative said,

“AxCNH brings the Chinese yuan into the global digital landscape.”

The stablecoin is designed to facilitate payments in places where traditional banking systems can be slow and costly.

AxCNH is overcollateralised, fully backed 1:1 by fiat deposits or government debt instruments, providing users with a higher level of confidence compared with algorithmic or undercollateralised stablecoins.

The stablecoin aims to make the Chinese yuan more accessible internationally, supporting China’s broader goal of expanding its currency influence in global markets.

South Korea Joins Stablecoin Race With KRW1

Following closely, South Korea’s BDACS launched KRW1, a stablecoin tied to the Korean won.

Like AxCNH, KRW1 is overcollateralised, giving businesses and individuals a secure method to participate in blockchain-based financial systems.

The move aligns with Seoul’s push to digitise its national currency and strengthen its presence in international trade networks, particularly amid growing competition in the regional digital economy.

Why Stablecoins Are Becoming Geopolitically Important

Governments are increasingly turning to stablecoins not just for technological adoption but as tools to influence international currency demand.

By placing fiat currencies on blockchain rails, nations can enable near-instant, 24/7 cross-border settlements while reducing reliance on slower, conventional financial systems.

This model helps mitigate inflationary pressures by connecting global users to domestic currency and government debt markets.

Overcollateralised tokens, such as those issued by Tether and Circle, have already reshaped sovereign debt dynamics.

By buying government securities to back their stablecoins, they make retail users indirect bondholders, boosting demand for state-issued debt, lowering yields, and easing government borrowing costs.

Tether, for instance, holds more U.S. Treasury bills than several developed nations combined, including Canada, Norway, and Germany.

Stablecoins Could Shift The Balance Of Digital Monetary Influence

Coinlive views the launches of AxCNH and KRW1 as a clear sign that Asia is aiming to compete with the U.S. dollar and euro in digital trade settlements.

With the U.S. national debt surpassing $37 trillion, stablecoins are increasingly seen as a tool to enhance confidence in domestic currency and sovereign debt.

Russian presidential advisor Anton Kobyakov recently noted that “the U.S. government is attempting to offset its $37 trillion debt with stablecoins and gold to boost confidence in the declining US dollar.”

While stablecoins offer clear advantages for cross-border payments and international currency demand, they also expose countries to new financial risks.

Market adoption, regulatory hurdles, and competition with other sovereign-backed tokens will determine whether projects like AxCNH and KRW1 can establish a lasting position or struggle under global market pressures.

Could Stablecoins Reshape Global Finance Or Become Just Another Digital Asset Experiment?

Coinlive considers the rise of sovereign-backed stablecoins as both strategic and experimental.

The potential to influence currency demand, reduce borrowing costs, and digitise trade corridors is significant, yet these projects face a complex landscape of geopolitical rivalry, regulatory scrutiny, and market adoption challenges.

AxCNH and KRW1 may mark the beginning of a new era in digital finance, but sustaining impact will depend on execution, trust, and the ability to navigate an increasingly crowded stablecoin market.