Chinese financial regulators have taken new steps to prohibit local companies from publishing research and holding seminars on stablecoins, reflecting their concerns about potential fraudulent activities.
Restrictions on Stablecoin Research
According to a report from Bloomberg, Chinese authorities have called on local firms to halt any research and seminars related to stablecoins. This information comes from several sources familiar with the matter. Major concerns are tied to the possibility of stablecoins being exploited in fraudulent schemes.
Market Strategies and Reactions
Christopher Wong, a currency strategist at Oversea-Chinese Banking Corp. in Singapore, noted that Beijing may aim to prevent speculation among retail investors. "There’s still a worry that not everyone knows adequately about crypto and policymakers being pragmatic don’t want herd mentality when investors buy into something that they do not know what the risks are," Wong stated.
Usage of Stablecoins Outside China
While the Chinese government imposes strict regulations, there is attention on the usage of stablecoins in Hong Kong, where rules are more flexible. For example, the Hong Kong subsidiary of Standard Chartered and Animoca Brands announced a joint venture to develop a stablecoin backed by the Hong Kong dollar. Additionally, in July, Chinese e-commerce giant JD.com registered entities associated with a potential stablecoin rollout.
Thus, Chinese authorities continue to maintain strict control over their financial sector, preventing the spread of stablecoins within the country while supporting initiatives in Hong Kong and beyond.
