“Stablecoins” have emerged as a new lever of influence for national currencies on the global stage. This was stated by Circle CEO Jeremy Allaire in an interview with Reuters, highlighting the significant potential of a stablecoin based on the Chinese yuan.
According to him, a fiat-pegged digital asset could make China’s currency more competitive and simplify global payments.
“A yuan stablecoin is a tremendous opportunity. In the currency race, the one with better characteristics wins. It’s a technological race,” said Allaire.
The CEO of the company issuing USDC predicted the emergence of a Chinese “stablecoin” within the next three to five years.
Allaire has held this position since at least 2023. Previously, he stated that stablecoins could be a more effective tool for the internationalization of the yuan than CBDC.
Current Position of Authorities
In July 2025, Chinese giants Ant Group and JD urged the People’s Bank of China (PBOC) to legalize yuan stablecoins in addition to the existing tokens based on the Hong Kong dollar.
Subsequently, reports emerged in the media that the government is considering approving stablecoins backed by national currency.
However, the authorities remain cautious. In August of the same year, China’s financial regulators demanded that brokerage firms and think tanks cancel seminars and cease publishing research on fiat-pegged assets.
Later, the PBOC confirmed its stance on the illegal status of digital assets in the country and outlined the risks associated with the use of stablecoins.
In February 2026, the People’s Bank and key agencies banned the issuance of yuan-pegged “stablecoins” outside the country without prior registration.
Officials also announced a tightening of the tokenization process for Chinese RWA. The aim of these measures is to protect financial stability, curb capital outflows, and maintain monetary sovereignty amid China’s promotion of its digital currency e-CNY.
As reported in The Economist, there are doubts about the success of a yuan stablecoin due to the country’s stringent capital movement controls.