Alibaba’s fintech division Ant Group and e-commerce giant JD.com are urging the People’s Bank of China to authorise offshore yuan stablecoins.
According to Reuters last week, talks centred on issuing the tokens in Hong Kong to update the legal environment, gain PBOC support, and challenge the dominance of the US dollar in international trade.
A Call for Offshore Yuan Tokens
JD.com and Ant Group want regulators to let them launch stablecoins backed by offshore yuan. They argue this step would strengthen the Chinese currency in global trade.
Both firms plan to base their tokens in Hong Kong under new rules that take effect on August 1. In private talks, JD.com has told the PBOC that a yuan stablecoin could rival dollar tokens and speed up international payments.
Racing Against Dollar Stablecoins
Global stablecoins now total about $247 billion in market value. Over 99 % of these are pegged to the US dollar. Industry estimates suggest the figure could reach $2 trillion by 2028.
JD.com and Ant fear that without a yuan alternative, Chinese exporters will keep using dollar tokens for cross‑border trade. Reports say some exporters already send and receive USDT because capital controls at home slow down yuan transfers.
Hong Kong’s New Framework
Hong Kong is set to roll out a stablecoin licensing regime on August 1. JD.com and Ant have both applied to issue Hong Kong dollar tokens under the new law.
They now want an extra green light from the mainland to create yuan‑pegged versions. Regulators have not yet decided, but insiders say the idea has gained traction in closed‑door meetings.
Broader Industry Support
Other players share the call for a yuan stablecoin, Wang Yongli of Digital China Information Service Group warned that growing dollar token use poses a strategic risk.
He noted that efficient cross‑border yuan payments are vital if China truly wants to raise its currency’s global share. SWIFT data show the yuan’s share in international payments dropped to 2.89 % in May, its lowest in almost two years. In contrast, the dollar holds 48.46 % of the market.
Blockchain’s Promise and China’s Ban
Stablecoins use blockchain technology to enable instant, around‑the‑clock transfers at minimal cost. This feature challenges traditional cross‑border payment systems.
Yet China banned cryptocurrencies in 2021, and regulators remain wary. PBOC governor Pan Gongsheng recently warned that digital currencies create major issues for financial supervision. Still, PBOC advisor Huang Yiping said an offshore yuan token in Hong Kong is a possibility.
Political Winds and Crypto Policy
The push for yuan stablecoins coincides with global shifts in crypto policy. In the US, former President Trump recently voiced support for stablecoins and called for clear rules. That contrast highlights China’s cautious stance.
At the same time, political leaders in Beijing want the yuan to rival the dollar and euro. A regulated yuan token could help fulfil that aim if capital controls can be managed.
Stablecoins and Exporters
Several exporters told Reuters they rely increasingly on USDT because it moves faster than the onshore yuan.
High trading volumes in the token for trade settlement have climbed fivefold since 2021, according to Hong Kong’s largest crypto OTC platform. This trend shows how dollar peg tokens fill gaps left by strict capital rules and geopolitical tensions.
Corporate Plans Beyond Hong Kong
Ant Group is preparing applications for stablecoin licences in both Hong Kong and Singapore. JD.com chairman Richard Liu also plans to seek licences in major currency markets.
They hope this network will ease foreign exchange and cross‑border payments for Chinese firms, especially smaller ones facing currency volatility.
JD.com and Ant Group’s bid for yuan stablecoins marks a new chapter in China’s digital finance. If approved, these tokens could reshape cross‑border trade and challenge dollar dominance. But success hinges on careful policy choices that marry control with the speed and openness that blockchain offers.
Also Read: China’s Financial Giant Ant Group Refutes Stablecoin Tie-Up Rumors with Chinese Firm Hainan Huatie