Why is China so strict about stablecoins? A former bank executive gives the answer

Question

[Chain Note] Recently, I came across an interesting viewpoint—a former senior executive at a certain bank explained why China is taking such a tough stance on stablecoins.

His logic is actually pretty straightforward: we’ve already taken the lead in mobile payments and the digital yuan, so there’s no need to develop a RMB stablecoin domestically, and internationally, we can’t compete with the dominance of USD stablecoins. More importantly, if we do follow the path of USD stablecoins, the RMB stablecoin is likely to become a follower rather than a challenger—which poses risks to foreign exchange management, cross-border capital flows, and even monetary sovereignty.

To put it bluntly, what appears to be a dispute over technical routes is actually about national financial security. Especially now, as the international situation grows increasingly complex, the regulators’ stance is clear: security first, efficiency second. The risks of money laundering and capital flight associated with stablecoins are no joke.

That said, even with a halt, the digital yuan needs to pick up speed. After all, it’s better to guide than to block—if we truly want to establish a foothold in the digital currency race, we have to rely on our own system to stand firm. The recent joint risk warning from seven departments also pointed out that stablecoins have too many loopholes in customer identification and anti-money laundering, so it’s no surprise they’re being targeted.

In short: China will not follow the pace of USD stablecoins—if it’s going to move forward, it will be on its own digital currency path.

HodlTheDoor · Accepted Answer

To be honest, I can understand this logic, but it still feels a bit conservative to me.

HalfPositionRunner · Answer

This logic does make sense. Rather than jumping on the stablecoin bandwagon, it’s better to focus on developing the digital RMB ecosystem.

But wait, why don’t USD stablecoins have these concerns? Or is it just because they’re already the top dog?

I believe it when they say security comes first, but it also feels like a forced choice.

The digital RMB can’t go abroad, stablecoins are locked down, it really feels like we’re just stuck in internal competition.

zkProofInThePudding · Answer

That logic does make sense, but it still feels a bit conservative.

USD stablecoins are indeed aggressive, but do we really have no chance?

I understand that safety comes first, but it’s still a bit frustrating to watch others reap the rewards.

The digital yuan is already doing well, but is there really no room for imagination when it comes to stablecoins?

This move is mainly out of fear of chaos, which is understandable, but it always feels like something is missing.

ProofOfNothing · Answer

You're absolutely right, they want us to be mere sparring partners for their USD stablecoins.

SocialFiQueen · Answer

At the end of the day, it's still a game between major powers; the issue of stablecoins is fundamentally not a technical problem at all.

LeverageAddict · Answer

To be honest, I agree with this logic. Rather than competing over stablecoins, it's better to hold on to the territory of digital RMB.

ImpermanentPhobia · Answer

To be honest, this logic feels a bit like it’s coming from a position of authority… I understand prioritizing security, but aren’t we also missing out on some opportunities?

PumpStrategist · Answer

The chip distribution showed it long ago; there were signals from the central bank about this move six months ago. This isn’t a technological competition, but a zero-sum game of geopolitical finance—just look at the chart and you’ll understand.