As an old veteran who has been struggling in the cryptocurrency world for many years, the recent characterization of stablecoins by the central bank feels like a deep-water bomb; the community is in an uproar! Some say this is a form of isolationism, but I feel that this move is both ruthless and precise. Today, let's clarify: why does China prefer to implement a 'one-size-fits-all' approach and label stablecoins as illegal? What is the future of the Renminbi?
01 The US dollar stablecoin has monopolized the market; the Renminbi is just a 'little brother' in this context.
First, let's look at the data: the current global stablecoin market size is about $300 billion, with USDT (pegged to the US dollar) dominating the market, accounting for over 60%. Including USDC and other US dollar stablecoins, the market share of US dollar stablecoins reaches as high as 99%. What does this mean? It means the stablecoin market has become a private territory of the US dollar, and other currencies can only play a supporting role.
Interestingly, even the international rating agency S&P gave USDT the lowest rating—'weak', because the high-risk ratio in its reserve assets has risen, with Bitcoin accounting for 5.6% and gold reserves swelling to 116 tons, comparable to a medium-sized country's central bank. This 'shadow dollar' can't stand on its own but wants to be a global payment tool? Nonsense!
If China were to launch a RMB stablecoin now, the result would be: using RMB to buy coins, and ultimately needing to convert back to USD for settlement, essentially working for the dollar. This is called 'currency substitution', which weakens RMB sovereignty.
02 Stablecoins are not 'stable'; they are a gray highway for illegal funds.
The central bank's categorization this time hits the nail on the head: stablecoins cannot effectively meet customer identity verification and anti-money laundering requirements, becoming a breeding ground for money laundering, fraud, and capital outflow. For example:
In 2025, a case of illegal currency exchange in Shanghai saw a gang use USDT to transfer 6.5 billion yuan over three years, with the operating model being 'collect RMB domestically → buy USDT → exchange foreign currency abroad', directly bypassing foreign exchange controls.
Many fraud apps are masquerading as 'central bank digital RMB pilot' projects, issuing fake stablecoins and absconding with funds.
This thing is technically a 'distributed ledger', but in reality, it has become a distributed tax evasion tool for the black market! What's even scarier is that its cross-border flow is in milliseconds; capital can escape at will, and the central bank cannot react in time. For a country like China with strict foreign exchange controls, stablecoins are a bomb that can explode at any time.
03 Digital RMB is the favored child, the national team takes action with dimensionality reduction strikes.
Why doesn't China follow the trend of creating stablecoins? Because it has a trump card—digital RMB (e-CNY). It is fundamentally different from stablecoins.
Issuing entity: Digital RMB is issued directly by the central bank, backed by national credit; stablecoins are issued by private institutions and may collapse (for example, if Circle goes bankrupt, USDC may become worthless).
Technical Logic: Digital RMB 'small amount anonymity, large amount traceability' can protect privacy while preventing money laundering; stablecoins have strong anonymity, and the flow of funds is hard to trace.
Strategic Goal: Digital RMB aims to restructure the cross-border payment system, directly connecting multiple central banks (such as the 'Digital Currency Bridge' project), reducing settlement costs to below one-tenth of traditional payments.
In September 2025, Shanghai has already unveiled the international operation center for digital RMB, and the cross-border platform 'Digital Currency Pass' can allow you to receive funds instantly. This setup is far superior to the 'small workshop-style' issuance of stablecoins!
04 What should ordinary users do? Beware of pitfalls, embrace compliance.
In the short term, banning stablecoins will give some cross-border traders headaches, but in the long term, it is definitely a positive.
Avoid engaging in foreign stablecoin transactions: buying and selling USDT now may be classified as 'illegal foreign exchange transactions', potentially even violating money laundering laws. You may be tempted by the exchange rate difference, but they are after your principal!
Focus on the digital RMB pilot: currently, digital RMB has been piloted in 26 regions, covering cross-border trade, public services, and other scenarios. In the future, it may support 'tap and pay' cross-border payments, with fees so low they can be ignored.
Beware of 'high-yield stablecoin' scams: terms like 'central bank strategic project' and 'capital protection with interest' are just the rhetoric of Ponzi schemes.
05 My opinion: The future of the coin circle is a war of sovereign currencies, not a game of technology.
Many people criticize China's regulation as too strict, but look at Europe and the US: the US has introduced the (GENIUS Act) to issue licenses for stablecoins, essentially aiming to consolidate hegemony with 'digital dollars'; Hong Kong's licensing of stablecoin regulation is also to attract capital. This war is no longer about 'decentralization' ideals, but rather a game of major powers for financial sovereignty.
China's choice is very clear: do not let stablecoins disrupt financial security and fully promote the internationalization of digital RMB. As ordinary people, we must see the trend—compliance is the future, and speculation will inevitably be cut down.
In summary: stablecoins are the scythe with which the dollar cuts globally, while digital RMB is China's shield for breaking the deadlock. Which one do you favor? Let's see the truth in the comments! Follow Xiang Ge for more firsthand information and precise points of knowledge in the coin circle; learning is your greatest wealth!
