China’s Regulators Clamp Down on Stablecoin Promotion, Reports Bloomberg

China’s financial regulators have instructed brokerage firms and think tanks to cancel seminars and cease publishing research on stablecoins, according to sources cited by Bloomberg.

Authorities are concerned that stablecoins could become a new tool for fraud in mainland China. Regulators also aim to prevent a frenzy over assets whose risks are not fully understood by investors.

Despite the Bans

The directive comes amid a general ban on cryptocurrency operations in the country. However, according to Chainalysis, the volume of over-the-counter digital asset trading in China reached $75 billion in the first nine months of 2024.

At the same time, authorities support the development of Hong Kong as a hub for digital assets. According to Bloomberg, the city has issued licenses to 11 cryptocurrency exchanges and 44 companies for digital asset trading, including firms with state backing from China.

Christopher Wong, a currency strategist at Oversea-Chinese Banking Corp., believes that China’s authorities are pragmatic. He notes that they do not want a “herd mentality” where investors buy into things they do not understand, hence their disapproval of excessive hype around certain topics.

Back in March, Bitcoin Magazine CEO David Bailey reported that China is actively working on creating its own strategic bitcoin reserve.

ForkLog compiled the latest news on regulation in Asia in one article.