China’s New Stablecoin Regulation: Domestic Promotions Banned, Hong Kong Framework Launched
China’s financial authorities have banned stablecoin promotions, research, and seminars in a fresh stablecoin regulation move to curb fraud and speculative trading. Banks must now flag high-risk crypto trades linked to cross-border gambling and underground banking. Conversely, Hong Kong has launched a six-month framework for stablecoin issuance, with Standard Chartered, Animoca Brands, JD.com, and Ant Group Singapore among registrants planning HKD stablecoins. Offshore yuan stablecoins are also emerging: Conflux’s yuan-backed token (CFX) and AnchorX’s AxCNH have received approvals for Belt and Road markets. This approach reflects China’s dual strategy in stablecoin regulation, balancing strict onshore control with proactive offshore issuance to extend its digital asset influence.
Neutral
The news is neutral for stablecoin prices. Chinese regulators’ clampdown reduces speculation but doesn’t affect peg stability. Hong Kong’s framework and offshore issuance support market development. In the short term, domestic stablecoin activity may slow, but long-term offshore initiatives could offset losses. Overall, stablecoin supply and demand remain balanced, keeping price stability intact.