China is preparing to launch stablecoins via Hong Kong under a new licensing regime, signaling its intent to challenge U.S. dominance in the digital currency space.
(Photo of Li Yang on Unsplash)
Posted August 7, 2025 at 10:13 am EST.
China is set to allow the launch of its first stablecoins as part of a strategic effort to internationalize the renminbi and compete with the U.S. dollar in global markets, according to a report from the Financial Times.
The plan involves testing and issuing stablecoins through Hong Kong, which has enacted a new legal framework allowing licensed businesses to issue tokens backed by fiat currencies.
Hong Kong’s new Stablecoins Ordinance, effective from August 1, requires issuers to be licensed by the Hong Kong Monetary Authority (HKMA) and meet rigorous operational and financial standards.
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The news comes after the enactment of the GENIUS Act – the first comprehensive and clear regulatory framework for stablecoins in the U.S.
Ahead of President Trump signing it into law, Wall Street giants Citibank and Morgan Stanley said there had been active discussions on the issuance of their own stablecoins.
“China needs to respond to the U.S.’s dominance in stablecoins, so we will see if it is too little or a quick catch-up move. Hong Kong is currently the testing ground for anything Web3,” said 0G Labs CEO Michael Heinrich, in a statement to Unchained.
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