Former Governor of the People's Bank of China Zhou Xiaochuan: Stablecoins may trigger speculation, and the advantages of cross-border payments are limited.

On August 28, according to Bloomberg, former Central Bank Governor Zhou Xiaochuan warned at a closed-door meeting in mid-July that stablecoins may lead to speculative behavior, thereby undermining financial stability. Zhou pointed out that stablecoins have limited advantages in cost compared to China's existing retail payment systems, and the claim that traditional cross-border payments are "extremely costly" may be exaggerated. He also stated that the regulatory frameworks in the U.S., Hong Kong, and Singapore have not sufficiently ensured that stablecoins "should be fully backed by liquid assets," emphasizing the need to be vigilant against fraud and systemic risks arising from their excessive use in speculative asset trading platforms.