Chinese tech giants JD.com and Ant Group are lobbying the People’s Bank of China to authorise the issuance of yuan-based stablecoins in Hong Kong, as part of efforts to counter the global dominance of U.S. dollar-linked cryptocurrencies.
Sources familiar with the closed-door meetings said both firms argue that offshore yuan stablecoins are crucial for promoting the internationalisation of the Chinese currency, especially as over 99% of existing stablecoins are pegged to the dollar. This move marks a potential shift in China’s restrictive stance on cryptocurrencies, which were banned in 2021.
The push comes at a time when Hong Kong is racing the United States to establish a regulatory framework for stablecoins. Both JD.com and Ant have plans to issue Hong Kong dollar-backed stablecoins once local legislation takes effect on August 1.
However, the companies contend that Hong Kong’s currency peg to the U.S. dollar undermines China’s objective to make the yuan a competitive global payment option. JD.com has reportedly proposed a pilot programme that would begin in Hong Kong and expand to China’s free trade zones, a proposal said to have been positively received by regulators.
Industry experts say the rising use of dollar stablecoins, such as Tether (USDT), especially among Chinese exporters and merchants, poses a strategic risk to yuan internationalisation. Former Bank of China vice head Wang Yongli warned that failing to match the efficiency of dollar-based digital transactions could erode China’s global currency ambitions. The yuan’s share of global payments has dipped to 2.89%, while the dollar maintains a commanding 48.46%, according to recent SWIFT data.
Meanwhile, Ant is reportedly preparing applications for stablecoin licences in Hong Kong and Singapore, with longer-term plans to support yuan-denominated digital tokens. JD.com chairman Richard Liu has also disclosed plans to apply for stablecoin licences in major currency countries.
Analysts believe that embracing offshore yuan stablecoins could offer Beijing a viable digital currency strategy without undermining its capital controls. With the global stablecoin market projected to reach $2 trillion by 2028, China appears increasingly compelled to act decisively in this digital financial race.