PBoC: strengthen interest rate policy implementation and supervision

PBoC: strengthen interest rate policy implementation and supervision

The People's Bank of China (PBoC) has been actively enhancing its interest rate policy implementation and supervision, aiming to bolster financial stability and economic growth. This move comes amidst a broader regulatory crackdown on stablecoins and digital assets, reflecting the central bank's commitment to managing risks and promoting responsible innovation.

In recent months, PBoC has intensified its oversight of financial institutions, particularly in the areas of interest rate policy and digital asset management. According to sources, the central bank has directed local firms to cease promoting, researching, or hosting seminars related to stablecoins, a move aimed at curbing speculative activity and preventing fraudulent schemes [1].

While the mainland remains firmly against public engagement with stablecoins, China is not entirely abandoning the concept. Officials are reportedly exploring the development of a yuan-pegged stablecoin to reduce the global dominance of the U.S. dollar [2]. These discussions are taking place behind closed doors, with policymakers reportedly consulting experts on design and implementation. Meanwhile, private companies such as JD.com and Ant Group are reportedly engaging with regulators to advocate for the issuance of stablecoins to promote the international use of the yuan [2].

Hong Kong has emerged as a key testing ground for these ideas. The territory has introduced a new stablecoin issuance framework with a six-month transition period, allowing for more structured development within a controlled regulatory environment [2]. Standard Chartered’s Hong Kong branch, for example, announced a partnership with Web3 firm Animoca Brands to develop a Hong Kong-dollar stablecoin. The bank is one of only three institutions authorized to issue physical Hong Kong dollars under Hong Kong Monetary Authority oversight [2].

Despite the domestic restrictions, China is actively participating in the global stablecoin landscape. For example, blockchain firm Conflux introduced a stablecoin backed by offshore Chinese yuan, and AnchorX has received in-principle approval from Kazakhstan’s regulator to issue a yuan-pegged stablecoin [2]. These stablecoins are designed for international use and are not intended for circulation within mainland China.

The regulatory divergence between China and other jurisdictions is notable. While the country continues to enforce strict domestic controls, there are early signs of a potential reevaluation of its broader digital asset strategy. This comes as other regions, including the U.S. and Hong Kong, move toward formal recognition of stablecoins through legislative and regulatory measures [2].

China is also advancing its own digital currency initiative—the digital yuan, or e-CNY. Earlier this year, PBOC Governor Pan Gongsheng outlined plans to establish an international operations center for the digital yuan in Shanghai, signaling a long-term vision of a global financial system less reliant on the U.S. dollar [2].

The combination of internal discussions, regulatory easing, and strategic global partnerships suggests that China’s digital asset strategy is evolving. For now, the government appears to be prioritizing risk management and public education, even as it explores the broader opportunities that stablecoins present in the global financial system [2].

References:
[1] Cointelegraph, [https://cointelegraph.com/news/chinese-regulators-urge-local-businesses-to-stop-stablecoin-promotion](https://cointelegraph.com/news/chinese-regulators-urge-local-businesses-to-stop-stablecoin-promotion)
[2] AInvest, [https://www.ainvest.com/news/china-cracks-stablecoin-promotion-global-regulatory-divergence-2508/](https://www.ainvest.com/news/china-cracks-stablecoin-promotion-global-regulatory-divergence-2508/)