Morning Brief: U.S. Scrutiny Driving China’s Stablecoin Ambitions, Says Animoca Leader

Once critical of stablecoins, China is now embracing them as part of a strategic pivot—driven by rising concern over the growing influence of U.S. dollar-backed digital assets in Asia’s financial systems.

Back in 2021, China’s central bank warned that global stablecoins posed significant threats to the international monetary system, financial stability, and cross-border capital management. At the time, its white paper on the e-CNY was seen as a firm rebuke to projects like Facebook’s Libra.

While Libra never launched, stablecoins like Tether’s USDT and Circle’s USDC have since become essential to global financial infrastructure, particularly across Asia, where they are widely used in payments, settlements, and trade financing.

Now, Chinese policymakers are reassessing. The concern: stablecoins are reinforcing the dominance of the U.S. dollar in digital finance—a development Beijing is increasingly eager to counter.

Animoca’s Auyang: GENIUS Act Accelerates the Race

Evan Auyang, president of Hong Kong-based Web3 firm Animoca Group, told CoinDesk that China’s interest in stablecoins is intensifying—especially after the U.S. passed the GENIUS Act. The legislation provides long-awaited regulatory clarity around fiat-backed stablecoins and reinforces the dollar’s strength in digital markets.

“Stablecoins are back on the radar because of U.S. policy,” Auyang said. “China sees this as a sign to move faster.”

Animoca is part of a consortium working on an HKD-backed stablecoin alongside Standard Chartered Bank and Hong Kong Telecom, aiming to develop compliant, regionally anchored alternatives to U.S.-linked tokens.

The CNH Stablecoin Strategy

Auyang believes offshore yuan (CNH) stablecoins could provide China with a way to internationalize the renminbi while maintaining capital controls. “If you want to globalize the RMB in a controlled fashion, the CNH stablecoin is the tool,” he said.

Issued outside mainland China—potentially in Hong Kong or via public blockchains—a regulated CNH or HKD stablecoin could connect to onshore assets and be used in broader cross-border trade.

Liquidity pools in Hong Kong could also facilitate settlement across CNH, HKD, and e-CNY, offering businesses an alternative to dollar-based rails for B2B payments.

Shift in Tone from 2021 to Now

China’s central bank once grouped stablecoins with volatile crypto assets, calling them destabilizing and speculative. Today, that tone has softened significantly. With U.S.-dollar stablecoins becoming entrenched, China appears ready to compete using its own tools and infrastructure.

“Every country will follow the U.S. in developing regulated stablecoins,” Auyang predicted. “This isn’t about replacing the dollar—it’s about building sovereign alternatives.”

Even in Southeast Asia, he added, there’s growing liquidity in non-USD stablecoin pairs—enough to support regional trade without defaulting to the greenback.

Market Update

• Bitcoin (BTC): Trading at $118,000, consolidating after hitting a record $123,000. Analysts warn of short-term pullbacks toward $115,000, though underlying momentum remains positive.
• Ethereum (ETH): ETH trades at $3,619, holding key support at $3,300 after a recent surge. Momentum remains bullish above major moving averages.
• Gold: Down 0.6% to $3,410.26 as easing U.S.-Japan trade tensions reduce demand for safe havens. Long-term drivers such as central bank buying and de-dollarization remain in focus.
• Nikkei 225: Gained 1.09% on optimism surrounding trade agreements with the U.S. and EU.
• S&P 500: Up 0.75% Wednesday, with the Dow rising 1% and the Nasdaq gaining 0.6% following favorable trade developments with Japan.

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