The PBOC has called for closer monitoring of stablecoins' impact on the global monetary system and cross-border payments, emphasizing a need for safer payment infrastructures.
The People's Bank of China (PBOC) has emphasized the need for increased oversight of stablecoins and their effects on the global monetary landscape and cross-border transactions. This call for vigilance was articulated by Wang Xin, the head of the PBOC's research bureau, during a recent financial forum in Shanghai.
Wang highlighted that the international payment system must be made safer, more neutral, and efficient, advocating for improved interactions between central bank settlement systems and retail networks. He underscored the importance of a "cautious and sustainable" approach to developing new financial tools, enhancing regulations, and fostering international cooperation.
"We need to closely monitor the influence of stablecoins on the international monetary system and cross-border payments," he stated.
Linking Payments to Global Trade
His remarks were part of a broader discussion on financial governance reforms and cooperation, where he connected the significance of payment systems to sustainable development and global investments. A representative from the PBOC noted that effective cross-border financing relies on a varied payment infrastructure that can bolster international trade and economic growth. However, Wang pointed out that the existing framework is increasingly uncertain and can be leveraged as a tool of pressure.
In light of these challenges, the central bank is advocating for a close watch on how stablecoins might shape cross-border settlements and the potential expansion of Central Bank Digital Currencies (CBDCs) beyond domestic borders.
China's Stance on Cryptocurrencies and the Digital Yuan
Despite the global rise of cryptocurrencies, China continues to enforce strict regulations against them. The government banned mining activities in 2021 and restricted banks and payment services from engaging in Bitcoin transactions. Authorities have reiterated the illegal status of cryptocurrency operations and highlighted the associated risks of stablecoins.
Consequently, the development of payment systems in China is largely advancing through the digital yuan (e-CNY) and regulated banking channels. Recent reports indicate that a new International Digital Yuan Operations Center, established in September 2025, has partnered with 26 financial institutions in Shanghai to facilitate cross-border e-CNY transactions.
Additionally, PBOC Governor Pan Gongsheng recently unveiled initiatives to enhance the offshore yuan's functionality in Shanghai, granting major state banks the authority to conduct offshore yuan transactions within the free trade zone. The PBOC also introduced the FIMA RMB Repo tool, which enables foreign central banks to access liquidity in yuan using high-quality Chinese bonds. This move is part of China's strategy to internationalize its currency and diminish reliance on the US dollar-dominated global payment system.
Notably, reports from August 2025 suggested that the Chinese government is contemplating the potential use of stablecoins backed by the yuan.
