Chinese companies JD and Ant Group are actively seeking the approval of yuan stablecoins from the People’s Bank of China to strengthen the yuan's position internationally.
Petition to the People’s Bank of China
Companies JD and Ant Group have petitioned the People’s Bank of China (PBOC) for the issuance of yuan stablecoins. The primary aim of this request is to compete with US dollar-denominated stablecoins, which currently dominate the market. JD executives met with PBOC officials to emphasize the importance of stablecoins in promoting global currencies.
Current Situation in the Stablecoin Market
Currently, over 99% of the stablecoins in circulation are pegged to the US dollar, creating challenges for economists who seek a multipolar world. The dominance of US dollar stablecoins can be attributed to their prevalent use on exchanges for trade operations. According to SWIFT data, the share of yuan trades stands at only 2.89% of the total volume.
China's Strategy and Opportunities for Yuan Stablecoins
Former Bank of China head Wang Yongli noted that if yuan payments remain less efficient than US dollar payments, China is exposed to strategic risks. PBOC is considering the establishment of an offshore yuan stablecoin, which may offset the dominance of dollar stablecoins and provide more options for consumers.
China continues to aim for a multipolar world and diversity in international trade. The introduction of yuan stablecoins may be a key step towards balancing the stablecoin market and providing additional investment opportunities in the Chinese market.
