- JD.com and Ant push PBOC for offshore yuan stablecoin approval now.
- Firms aim to boost yuan use, challenge dollar’s stablecoin dominance globally.
- JD.com plans Hong Kong dollar coin first, yuan coin expansion next.
Chinese tech giants JD.com and Ant Group are making new moves in the digital currency space. According to Reuters, both companies are now lobbying China’s central bank to approve offshore yuan-based stablecoins. These stablecoins would be pegged to offshore yuan and initially introduced in Hong Kong.
Big Tech Eyes Offshore Yuan Coin for Global Transactions Boost
This concept is brought the fact that the market of global stablecoins is expanding fast. Currently, more than 99% of all stablecoins are pegged to the U.S. dollar. Some of the biggest names such as Tether USDT and Circle USDC are taking the lead in the market. But this is the trend that JD.com and Ant Group are eager to alter. They desire to have a larger contribution of the Chinese currency in the digital payment platform.
The two firms believe that a yuan-pegged stablecoin would facilitate in expanding applications of Chinese money in international transactions. In so doing, they expect to facilitate the cross-border yuan payments to be quicker and cheaper. They wish also to provide an alternative to dollar-collateralized stablecoins that are used by Chinese exporters.
However, the future presents some obstacles. At home, China continues to prohibit cryptocurrencies. As a result, its leaders start to pay more attention to stablecoins and their effects on economics. Recently, Pan Gongsheng, the governor of the central bank of China said that digital currencies and stablecoins present huge issues to regulators.
According to an interview with the PBOC advisor, Huang Yiping, it is possible to have an offshore yuan stablecoin in Hong Kong. This indicates that the leaders in China are willing to consider the option of adopting stablecoins to advance the adoption of the yuan globally.
Ant Group Eyes Licenses in Hong Kong
Meanwhile, JD.com and Ant Group do not waste time. One of the biggest online retailers, JD.com, has announced that its chairman, Richard Liu, plans to seek stablecoin-license in many countries. He aims at making companies deal with foreign exchange and international payments more conveniently.
JD.com also plans to launch a Hong Kong dollar-pegged stablecoin by the end of this year. However, the company feels that the yuan stablecoin is more significant. JD.com has informed the Central Bank of China that the Hong Kong dollar is pegged to the U.S. dollar. Therefore, it is not conducive to popularizing the use of the yuan in commerce. They sought approval to launch yuan stablecoins in Hong Kong initially and then spread to the other free trade zones.
Ant Group is also set to apply for stablecoin licenses. The sources say that Ant seeks the approval in Hong Kong, Singapore, and Luxembourg. This would assist the firm to expand its blockchain payments across the globe.
Meanwhile, the stablecoin market around the world is becoming larger. Standard Chartered, however, states that the market of stablecoins may increase 80-fold, reaching a value of 2 trillion dollars in 2028. Increasingly more people are trading, using in DeFi projects and even company treasuries in stablecoins.
Stablecoins are also gaining acceptance in the U.S. Since returning to the office, President Donald Trump has been a supporter of dollar-backed stablecoins. He desires there to be clear regulations to assist the expansion of stablecoins in America.
With the race to stablecoins turning global, JD.com and Ant Group do not want China to lose its currency. They aim to topple the dollar domination in the digital space by promoting yuan-based stablecoins.