TLDR:

Shanghai regulators met to explore stablecoin strategies for yuan-linked innovation.
JD.com and Ant Group are preparing for Hong Kong stablecoin license applications.
China faces capital control hurdles despite rising pressure to compete with U.S. stablecoins.
The PBoC remains cautious but tone is shifting as local officials push for controlled pilots.

China appears to be easing its approach to stablecoins, following recent talks in Shanghai involving high-level regulators. 

While the country continues to ban cryptocurrency trading and mining, a new meeting this week suggests authorities may be exploring ways to engage with blockchain-based payment innovations. This development follows increasing pressure from local experts and major firms seeking to launch a yuan-based stablecoin. 

The tone at the Shanghai meeting signaled a departure from previous hardline stances, hinting at potential changes in digital currency regulation. Though no firm decisions emerged, the meeting marks a notable shift in how China is approaching the stablecoin conversation.

Shanghai Officials Consider Stablecoin Strategy

The meeting brought together local government officials and policy experts, according to a report by Reuters. 

According to a post on the commission’s official WeChat account, attendees discussed strategic approaches to stablecoins and digital currencies. The group emphasized the importance of tracking emerging technologies and deepening research into digital payment systems.

Photos from the event showed around 60 to 70 participants, highlighting the level of engagement from public sector stakeholders. He Qing, director of the Shanghai commission, urged increased sensitivity to financial innovation. 

Shanghai’s role as China’s international finance hub suggests it could take the lead in pilot initiatives tied to blockchain-based payment systems.

Companies such as JD.com and Ant Group have reportedly urged China’s central bank to greenlight yuan-backed stablecoins. Their objective is to counter the growing influence of U.S. dollar-linked digital assets across Asia and beyond. 

According to sources, these firms are preparing to apply for licenses in Hong Kong, which will introduce formal stablecoin regulations beginning August 1.

This interest comes amid rising global momentum for stablecoins, which offer low-cost, fast transactions and are usually pegged to fiat currencies. In the U.S., companies like Amazon and Walmart are exploring their own stablecoin strategies under a more mature legal framework. 

Meanwhile, South Korea’s government has supported the development of won-based stablecoins, though adoption there remains cautious.

Regulatory Hurdles and Policy Direction

Despite the optimism, several challenges remain. Market participants note that China’s capital controls could complicate any path toward stablecoin development. 

At the Shanghai meeting, a policy expert from Guotai Haitong Securities outlined the evolution, classifications, and global regulatory responses to stablecoins. The expert also discussed the risks and offered policy suggestions tailored to China’s environment.

Yang Tao, deputy director of the National Institution for Finance and Development, recommended exploring yuan-based stablecoins in Shanghai’s Free Trade Zone and Hong Kong. However, China’s central bank continues to view the rapid growth of digital currencies as a risk to financial stability.

The People’s Bank of China, which launched the e-CNY as a central bank digital currency, still holds a cautious stance on private stablecoins. Governor Pan Gongsheng warned last month about the regulatory risks posed by the growing digital currency market. 

However, the recent Shanghai talks reflect a subtle change in tone, opening the door for future developments as local governments weigh innovation alongside control.

 

The post China Rethinks Stablecoin Policy as Shanghai Hosts Strategic Talks appeared first on Blockonomi.

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Filed under: Bitcoin - @ July 11, 2025 5:25 pm