China Considers Yuan-Backed Stablecoin Launch in Strategic Crypto Pivot

China is reportedly in advanced discussions to authorize yuan-pegged stablecoins, marking a potential reversal of its stringent 2021 cryptocurrency ban. The State Council will review a policy roadmap this month that could enable regulated stablecoin issuance tied to the renminbi—a move designed to amplify the currency's global influence.

The initiative directly challenges U.S. dollar dominance in the $288 billion stablecoin market, where dollar-backed variants currently command 98% share. Cross-border trade applications WOULD take priority, with Hong Kong and Shanghai serving as testing grounds for the rollout.

This development follows China's aggressive promotion of its central bank digital currency (CBDC) and suggests Beijing now views compliant stablecoins as viable instruments for international finance. The timing coincides with heightened geopolitical tensions, as former U.S. President TRUMP recently vowed to bolster dollar-based stablecoin initiatives.