One of the world's strictest regulators of the cryptocurrency might be releasing a new stablecoin based on its national currency.
According to the Reuters report, China authorities may soon allow the issuance and use of a yuan-egged stablecoin as part of a broader effort to challenge the U.S dollar.
This announcement, if true, would signify a huge u-turn from its previously stringent policies on crypto after the country banned crypto trading and mining in September 2021.
The news comes after multiple reports suggested that mainland China could be warmingup to stablecoins amidst the stablecoin push in the United States.
Sources suggest that the State Council is expected to review and potentially approve a comprehensive stablecoin roadmap later in August, aiming to bolster the yuan’s global usage and challenge the dominance of the US-led stablecoin sector.
A core element of the proposal includes using yuan-backed stablecoins for cross-border trade and international settlements.
The forthcoming Shanghai Cooperation Organization (SCO) Summit in Tianjin, scheduled for August 31 to September 1, is expected to address this issue directly.
According to sources, both Hong Kong and Shanghai are being targeted as priority hubs for the rollout of stablecoin initiatives, underscoring their strategic roles in China’s global finance ambitions.
This renewed openness comes amid mounting efforts across mainland China to reassert the yuan’s influence on the global stage, especially in response to America’s advancements in stablecoin adoption throughout 2025.
As of June, the yuan ranked sixth worldwide for payments by value, holding a 2.9% market share per Swift’s RMB Tracker.
In recent months, China has also explored fresh avenues for foreign institutions to engage the yuan—especially as the US Dollar Index faced substantial declines.
As part of this currency internationalization drive, People’s Bank of China Governor Pan Gongsheng has outlined plans to reduce reliance on any single sovereign currency and advance the digital yuan’s global presence, including through a new internationalization center in Shanghai.
Despite the yuan’s growing prominence, the stablecoin sector remains heavily weighted in favor of dollar-backed tokens, which comprise nearly 98% of the $288 billion global stablecoin market cap, according to CoinMarketCap.
With President Donald Trump doubling down on dollar dominance by championing stablecoins internationally, other jurisdictions—including China—are being spurred to accelerate their own regulatory and technological initiatives.
In June, a PBOC official publicly acknowledged the transformative role of stablecoins in global settlement systems, calling for regulatory clarity on yuan-backed tokens.
By July, local blockchain platform Conflux launched a stablecoin backed by the offshore Chinese yuan while Hong Kong enacted a new stablecoin regulatory regime on August 1.
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