China Halts Private Stablecoin Issuance Plans Amid Central Bank Concerns
Plans by major chinese technology companies to issue stablecoins have been suspended following intervention from Chinese authorities, according to a report by the Financial Times. The move signals a firm stance by Beijing regarding control over currency issuance and potential challenges to its digital currency project,the e-CNY.
Multiple officials from the People’s Bank of Korea (PBOC) – as reported to the FT – indicated concerns about allowing technology firms or securities companies to participate in currency issuance. This led to a plan to halt stablecoin initiatives within mainland China. A key concern voiced by officials was whether the authority to issue currency should reside wiht the central bank or private entities.
Stablecoins,digital assets typically pegged to fiat currencies like the US dollar (with 99% of the global supply linked to the dollar,according to the Bank for International Settlements),are a dominant payment method within the cryptocurrency market.
The regulatory actions highlight a global debate surrounding the appropriate response to the growing prevalence of stablecoins. China, in particular, is grappling with the basic question of currency control. As 2021, China has maintained a restrictive approach to virtual currencies, banning trading and mining activities due to fears of financial instability.
However, a contrasting approach is being tested in Hong Kong. Since August of last year, the Hong Kong Monetary Authority (HKMA) has enacted ordinances permitting businesses meeting specific capital, liquidity, and reserve requirements to issue or distribute stablecoins with official authorization.
This divergence has sparked internal debate within China. Zhu Guangyao, former Vice Minister of Finance, argued in June that the US promotion of stablecoins aims to reinforce the dollar’s dominance, and advocated for China to develop a renminbi-linked stablecoin, leveraging Hong Kong’s pilot program as part of a broader national financial strategy.
Conversely, Zhou xiaochuan, former governor of the People’s Bank of China, cautioned against the risks of stablecoins, warning in late August that they could fuel speculation and financial instability.He also questioned the actual demand and potential for cost reduction in payment systems.
Neither the People’s Bank of China nor the Hong Kong Monetary Authority offered comment on the suspension of the stablecoin project when contacted by the FT. Ant group, JD.com, and the National Internet Information Office also did not respond to requests for comment.
(Source: yonhap News Agency, October 19, 2025)
