Golden Finance reported that China Economic Times published an article stating that developing offshore RMB stablecoins is an important approach to accelerating the internationalization of the RMB and a significant means to mitigate the impact of uncertainties in the development of “digital currency Bridges”, and it will not affect the monetary policy regulation and cross-border capital management in the mainland. In terms of the development pace, a gradual model is adopted, gradually expanding from the Hong Kong region to the free trade zones and free trade ports on the Chinese mainland, thereby continuously strengthening the supporting role for the internationalization of the RMB.
Shen Jianguang, chief economist of JD Group, and Zhu Taihui, senior research director of JD Group, said that stablecoins and cryptocurrencies have entered a fast growth track. Especially since the second term of US President Trump, he has actively promoted the development of stablecoins and cryptocurrencies in the United States, which has triggered a re-examination of the development of cryptocurrencies, especially stablecoins, by countries around the world. For China, developing offshore RMB stablecoins is an important approach to accelerating the internationalization of the RMB and a significant means to mitigate the impact of uncertainties in the development of “digital currency Bridges”. Moreover, it will not affect the monetary policy regulation and cross-border capital management in the mainland. In terms of the development pace, a gradual model is adopted. After accumulating experience and improving the mechanism in Hong Kong, it will be gradually promoted from Hong Kong to the free trade zones and free trade ports on the Chinese mainland in accordance with the model of “offshore first and then offshore within the mainland”, thereby continuously strengthening the supporting role for the internationalization of the RMB.
Global stablecoins have entered a fast development track. Compared with the frequently and significantly fluctuating cryptocurrencies such as Bitcoin and Ether, stablecoins pegged to fiat currencies not only possess the openness, transparency, decentralization and globalization attributes that blockchain technology and distributed ledgers endow to cryptocurrencies, but also have the feature of stable value of fiat currencies. Since its launch in 2014, stablecoins have withstood multiple risk shocks and once again entered a rapid growth track in the second half of 2023. As of now, the market size of stablecoins has reached 250 billion US dollars. In the past 12 months, the number of active holding addresses of stablecoins has exceeded 240 million, and the adjusted number of stablecoin payment transactions has reached 1.4 billion, with a transaction scale of 6.7 trillion US dollars. In May 2025, the Lending Advisory Committee of the US Treasury Department predicted that the market size of stablecoins would reach 2 trillion US dollars by 2028.
The service functions of stablecoins have been fully recognized. In the early days of its launch, stablecoins were mainly used for the transaction settlement of crypto assets. However, in recent years, they have been rapidly applied in areas such as avoiding the depreciation of domestic currencies, cross-border trade settlement, daily transaction payments, and other financial investments. According to the data from the World Bank, existing cross-border bank remittances usually take five working days to settle, with an average cost rate of 6.35%. However, blockchain-based stablecoin payments support global “7×24” real-time payments and have very low costs. For instance, the average cost of sending stablecoins via blockchains like Solana is only around 0.00025 US dollars.
Stablecoins are also accelerating their integration with the traditional financial system. In terms of payment institutions, the US online payment company PayPal has launched the stablecoin PayPal USD pegged to the US dollar. The online payment company Stripe is also actively promoting stablecoin payment services. The cooperation between the world’s leading stablecoin issuers, cryptocurrency exchanges and payment institutions, as well as credit card institutions, is also accelerating. In terms of financial institutions, jpmorgan Chase launched its own stablecoin JPM Coin in 2019 and subsequently introduced the blockchain payment platform Kinexys. Since 2024, Standard Chartered Bank in Hong Kong, Itau Unibanco, the largest bank in Brazil, several leading financial groups in Japan, and First ABU Dhabi Bank of the United Arab Emirates have all been exploring the launch and issuance of stablecoins to improve cross-border payment services and expand service revenues. In the capital market, an increasing number of institutional investors are beginning to hold stablecoins and invest in cryptocurrencies. Decentralized financial businesses such as lending and trading based on stablecoins are also developing rapidly.
The core of the “New Cryptocurrency Deal” in the United States is to support the development of US dollar stablecoins. During his election campaign, Trump proposed a package of new policies to support the development of cryptocurrencies, demanding that the United States be made the world capital of cryptocurrencies. Soon after taking office as president, he issued the executive order “Strengthening the United States’ Leadership in Digital Financial Technology”. Currently, cryptocurrency transactions are settled through stablecoins, and over 95% of stablecoins are pegged to the US dollar. In fact, the core focus behind the new policy on cryptocurrencies in the United States is on dollar stablecoins. By developing dollar-led stablecoins and the cryptocurrency market settled in dollar stablecoins, the influence of the US dollar in the field of new cryptocurrencies is expanded. By the end of 2024, the US dollar stablecoin USDC has been providing US dollar services in over 180 countries and regions.
Us dollar stablecoins help strengthen the position of the US dollar in the global monetary system. According to data from the International Monetary Fund, the share of the US dollar in global official reserves dropped to a record low of 57.8% in the fourth quarter of 2024. Currently, stablecoins serve as a bridge that links cryptocurrencies with the US dollar and the traditional financial system. As of the end of May 2025, the vast majority of the approximately 250 billion US dollars of stablecoins were US dollar stablecoins, and about 80% of the reserve funds of stablecoins were invested in US Treasury bonds, making it one of the top 20 holders of US Treasury bonds. The United States can strengthen the position of the US dollar in the global monetary system through the cycle of “dollar issuance – dollar stablecoins – cryptocurrency trading – US Treasury bond investment”.
At present, China is piloting the “Digital RMB” domestically and, in collaboration with the Bank for International Settlements, is promoting the “Digital Currency Bridge” for cross-border payments, in an effort to enhance the international status of the RMB. In June 2024, the “Digital Currency Bridge” has entered the stage of minimum viable products. However, under pressure from the United States and Europe, the Bank for International Settlements withdrew from the “Digital Currency Bridge” project in November 2024. In April 2024, the Bank for International Settlements supported the launch of another project, Agora, which utilizes blockchain technology to enhance cross-border payments. Wholesale central bank digital currencies and tokenized deposits from countries such as the United States, the United Kingdom, France, Switzerland, Japan, South Korea, and Mexico all operate on the same blockchain system. It has a higher degree of global connectivity than the “Digital Currency Bridge” project. In the absence of coordination by the Bank for International Settlements and strong competition from blockchain cross-border payment projects, the uncertainty of the development prospects of “digital currency Bridges” has significantly increased.
In recent years, supported by measures such as expanding local currency swap agreements, promoting the cross-border payment system of the RMB, and enhancing the use of the RMB in investment and trade along the Belt and Road Initiative, the proportion of the RMB in global payments has risen to the fourth place. However, the market share (3.75% at the end of December 2024) still has a considerable gap compared with the US dollar (49.12%), especially as the RMB is less used in international payments involving non-Chinese enterprises. At present, the digitalization of finance and trade both at home and abroad is developing rapidly. Meanwhile, stablecoins are the tokenization of fiat currencies on the blockchain, which inherently possess global attributes. Moreover, their application scenarios such as cross-border trade payments are being rapidly promoted. The development of offshore RMB can help address this shortcoming in the internationalization of the RMB.
From a macro perspective, some experts believe that the issuance of RMB stablecoins will weaken a country’s monetary regulation and capital control capabilities. However, as long as the regulatory and supervision system is improved, it is entirely possible to ensure the policy controllability of RMB stablecoins. Concerns over sovereign currency substitution have relatively mature solutions in the services of stablecoin issuers and cryptocurrency exchanges, which can be mitigated by controlling IP addresses and restricting the domestic use of foreign currency stablecoins. Moreover, the development of an offshore RMB and the development of a “digital currency bridge” are not in a competitive relationship but rather complementary. The Aurum project tested in Hong Kong in 2022 demonstrated that the two can coexist completely in cross-border payments, thereby accelerating the internationalization of the RMB.
The latest risk prevention and control technologies for stablecoins and cryptocurrencies have shown that requiring stablecoin issuers and exchanges to implement “large amount transfer monitoring systems” and strictly enforce anti-money laundering “travel rules” can effectively monitor the transaction details of stablecoins. In addition, countries have currently established relatively complete regulatory mechanisms for the issuance, trading and redemption of stablecoins, and the protection of the rights and interests of stablecoin holders has been significantly improved. Concerns over the loss of control over monetary policy, for offshore RMB stablecoins, the current offshore RMB market only accounts for 3% of the total currency of the People’s Bank of China, and its scale is limited. Even if the scale increases significantly in the future, it can still be regulated through methods such as the issuance of offshore RMB central bank bills and the Hong Kong Interbank Offered Rate. Currently, Tether, the world’s largest stablecoin issuer, has issued offshore RMB stablecoins, with the current circulation exceeding 20 million yuan.
In terms of timing, it is better to launch an offshore RMB stablecoin in Hong Kong as soon as possible rather than later. The development of stablecoins has extremely strong scale effects and network effects. It is very difficult for later-issued stablecoins to catch up with those that were issued earlier. At present, US dollar stablecoins occupy more than 95% of the stablecoin market share, and the issuance of RMB stablecoins has become extremely urgent. Hong Kong is an offshore RMB trading center and has been actively improving the regulatory mechanisms for stablecoins and cryptocurrencies in recent years. A complete licensing system for cryptocurrency trading platforms has been established in the early stage. Recently, the “Stablecoin Regulations” have been passed and will be officially implemented on August 1st, laying a solid institutional foundation for the development of stablecoins. When launching offshore RMB stablecoins, it is necessary to clarify the rules regarding the issuers of stablecoins, reserve requirements, trading platforms, regulatory authorities, anti-money laundering and anti-terrorist financing, etc., to ensure the stable operation of offshore RMB stablecoins.
In terms of spatial layout, a progressive promotion model is adopted. After accumulating experience and improving the mechanism in Hong Kong, it will be gradually promoted from the Hong Kong region to the free trade zones and free trade ports on the Chinese mainland in accordance with the model of “offshore first and then offshore within the mainland”. On the one hand, overseas, Hong Kong will be developed into a global trading center for offshore RMB stablecoins, and gradually expand to global financial centers such as Singapore, London and New York to enhance the global influence of offshore RMB stablecoins. On the other hand, within the country, pilot projects of domestic offshore RMB stablecoins will be carried out in places such as the Lingang New Area of the Shanghai Free Trade Zone and the Hainan Free Trade Port to explore the operation mechanism and regulatory model of domestic offshore RMB stablecoins. Once the pilot projects mature, they will be gradually promoted to other free trade zones and free trade ports. Through this progressive promotion model, the supporting role of offshore RMB stablecoins in the internationalization of the RMB is continuously strengthened.
Related Topics:
