Exclusive to Reuters: China plans to approve the internationalization strategy of the Renminbi stablecoin! The State Council is reviewing the roadmap this month, and the Shanghai-Hong Kong pilot is accelerating to break through the dollar hegemony.

Exclusive reports from Reuters indicate that the State Council of China will review a significant plan to promote the internationalization of the yuan this month, considering for the first time the use of yuan-backed stablecoins as a cross-border payment tool. This proposal aims to address the global dominance of dollar stablecoins, and if approved, it will mark a major shift in China's regulatory policy towards Digital Money. Shanghai and Hong Kong will become the first localized pilot cities, with relevant details expected to be disclosed during the Shanghai Cooperation Organization summit in Tianjin on August 31.

Major Policy Shift: From Banning Cryptocurrency to Embracing Stablecoin

According to informed sources, the State Council of China will review and pass a roadmap this month to enhance the global usage of the renminbi, which will for the first time include a strategy to catch up with the development of American stablecoins. If the plan is implemented, it will completely reverse the regulatory stance of the comprehensive ban on cryptocurrency trading and mining in 2021. The plan will clarify the goals of renminbi internationalization, the division of domestic regulatory responsibilities, and risk control guidelines.

Breaking the Dollar Hegemony: Renminbi stablecoin as a Strategic Tool

Currently, US dollar stablecoins account for over 99% of the global stablecoin supply (according to data from the Bank for International Settlements), while the Chinese yuan only accounts for 2.88% of the SWIFT global payment share (June data). Chinese leadership believes that stablecoins based on blockchain technology can achieve low-cost, instant cross-border capital flows, and are expected to break the monopoly of traditional cross-border payment systems. Sources say that senior officials plan to hold a special study meeting at the end of the month to set the direction and boundaries for the commercial application and development of stablecoins.

Hong Kong-Shanghai Dual City Pilot: Accelerating the Localization Process

Hong Kong and Shanghai will become the first pilot cities: Hong Kong has implemented the long-awaited stablecoin regulations on August 1, becoming one of the world's first jurisdictions to regulate fiat-backed stablecoin issuers; Shanghai is building an international operating center for Digital Money. Huang Yiping, an advisor to the People's Bank of China, recently stated that the issuance of offshore RMB stablecoin in Hong Kong "has the possibility." In July, the Shanghai regulatory authorities convened local government officials to discuss strategies for responding to stablecoins.

Tianjin Summit Preview: The Shanghai Cooperation Organization may become the first launch scenario

China plans to discuss the expansion of the use of the renminbi in cross-border trade settlements with member countries at the Shanghai Cooperation Organization (SCO) summit to be held in Tianjin from August 31 to September 1. Stablecoins may become a key tool. This move has significant geopolitical implications—Chinese exporters are increasingly using USD stablecoins, and the new strategy aims to build alternative financial infrastructure.

Challenges and Opportunities: Capital Controls and the Trillion Dollar Market Paradox

Despite its ambitious strategic goals, China's strict capital controls remain a core obstacle to the development of stablecoins. China maintains a trade surplus of over a trillion dollars each year, but capital flow management restricts the free convertibility of the renminbi. Standard Chartered Bank predicts that the global stablecoin market size will grow from the current $247 billion to $2 trillion by 2028, making it crucial for China to balance financial innovation with risk prevention.

Conclusion

The Renminbi stablecoin strategy marks a historic turning point in China's Digital Money policy. If successfully implemented, it could not only reshape the cross-border payment landscape but also provide a crucial technological leverage for the Renminbi to challenge the US dollar's hegemony. However, the tension between capital controls and financial stability remains the biggest variable. The global stablecoin race has entered a new phase of Sino-American institutional model confrontation, with South Korea promising to launch a won stablecoin and Japan accelerating legislation. How China can take the initiative deserves ongoing attention.