Former Executive of the Bank of China: Rise of Stablecoin poses a political challenge for China

The growing ladder of stable -coated stables in US dollars has a strategic challenge for the Chinese monetary system, according to a blog article published by economist Wang Yongli on June 3.

Wang, a former MP for China, warned that the uncontrolled expansion of the risks of stablescoins USD undergoing China’s efforts to promote the renminbi in world payments.

The growth of the USD Stablecoin exerts pressure on the E-CNY strategy

Wang highlighted the rapid growth of digital token at point like the USDT and the USDC, which treated more than 27 billions of dollars in colonies last year and now represent more than 99% of the Fiat stable market.

He argued that these developments, as well as the newly passed regulatory executives in the United States and Hong Kong, indicate a change in global finance that the Chinese continent must respond with urgency.

“If the digital yuan cannot equal or exceed the advantages of the efficiency and costs of the stablescoins USD, the internationalization of the renminbi will be confronted with serious obstacles,” Wang wrote.

He called for an accelerated deployment of the E-CNY beyond national detail tests, suggesting that China plans to launch a stablecoin in Yuan Offshore in Hong Kong. This decision, he said, could serve as a transitional model to support digital payments based on CNY on the world markets.

Wang has also warned that the global regulatory adoption of stablecoins, in particular those linked to the US dollar, effectively strengthens American monetary domination.

Multi-CBDC networks considered as a potential strategic point of sale

With the Hong Kong dollar itself set for the greenback, he noted that the new regulatory regime of the city further strengthens the dollar regulation networks across Asia.

While current policies in continental China restrict cryptographic trading and the use of private tokens, Wang has declared that selective engagement, in particular in business applications and payment infrastructure, may be necessary to maintain relevance in the evolving digital financing environment.

“Stablecoins have become an arena with high issues for geopolitical and economic influence,” he wrote, adding that the integration of digital identity infrastructure with digital money could give China a long-term advantage if it was effectively implemented.

Wang previously held Board of Directors in Swift China and held management positions in several financial and technological companies. His comments reflect a growing concern among Chinese financial experts concerning the rhythm and the world development management of digital assets.

Wang’s comments raise the question of whether E-CNY could possibly participate in multi-CBDC platforms which support direct regulations through borders. Such integration, if it was prosecuted not only to counterbalance the stubborn stubborn in dollars, but would also offer China an alternative route to set up transactions based on the Yuan.

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