China’s Central Bank Halts Private Stablecoin Initiatives in Hong Kong

Beijing has quietly intervened to curb Hong Kong’s burgeoning stablecoin ambitions, directing major Chinese tech firms to pause their crypto-related plans. ANT Group and JD.com, key players in China’s digital economy, were preparing to issue yuan-pegged stablecoins under Hong Kong’s new licensing framework. The initiative was abruptly halted after central authorities raised concerns that private digital currencies could challenge the dominance of China’s digital yuan.

Officials from the People’s Bank of China and the Cyberspace Administration warned the companies against proceeding, citing risks to monetary control. Central bank governor Zhou Xiaochuan recently emphasized that unregulated stablecoin issuance and financial leverage could destabilize monetary systems, even as jurisdictions like the U.S. and Hong Kong attempt to mitigate such risks through new regulations.

Hong Kong’s government has sought to position itself as a crypto-friendly hub, attracting over 70 companies with its clear stablecoin framework. However, Beijing’s intervention underscores the limits of Hong Kong’s autonomy in financial matters, reinforcing China’s tight grip over digital currency innovation.