JD.com and Ant Group are in discussions with the People's Bank of China about the need for an offshore yuan token to enhance the currency's global presence.
Discussions with the People's Bank of China
JD.com and Ant Group are negotiating with the People's Bank of China, emphasizing the need for an offshore yuan token to strengthen the currency's international influence. The companies plan to issue Hong Kong dollar stablecoins when new crypto regulations take effect on August 1.
Issues with Yuan's Global Competitiveness
The current situation indicates that the Hong Kong dollar's firm peg to the US dollar does little to enhance the yuan's international standing. Analysis shows that over 99% of the global supply of stablecoins is comprised of dollar assets. This trend is contributing to the growing preference for USDT among Chinese exporters for cross-border transactions due to its ease of use and absence of capital controls.
Need for a Timely Response
Expert data points out that time for decision-making based on current circumstances is running out. The success of the US in stablecoin regulation and the promotion of crypto innovation put China under pressure to adapt. The creation of a yuan stablecoin in Hong Kong could be the optimal solution for revitalizing China's position in the international financial system.
In the face of growing competition and changes in the cryptocurrency market, creating an offshore yuan could be a significant step toward enhancing the international significance of the Chinese currency.
