Policy
China Explores Yuan-Backed Stablecoins in Major Policy Reversal
The move aims to boost the yuan's global usage and challenge the dollar's dominance in international trade.
August 24, 2025
• China may authorize yuan-backed stablecoins to increase the global use of its currency.
• The move is a strategic effort to challenge the dominance of the U.S. dollar in global trade.
• This represents a major reversal of China's previous restrictive stance on digital assets.
China's State Council is considering a proposal to authorize yuan-backed stablecoins, a significant shift from its 2021 ban on cryptocurrencies. The initiative is aimed at promoting the international use of the yuan, particularly in cross-border trade, as a strategic alternative to the dollar-dominated global financial system.
This potential policy change signals a major reassessment of digital assets by Beijing, driven by the desire to compete with the growing influence of USD-backed stablecoins.
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