Jeremy Allaire, the CEO of Circle, shared with Reuters in Hong Kong that there exists a “significant opportunity” for a stablecoin backed by the yuan. He anticipates that China may introduce such a currency within three to five years as digital currencies become increasingly woven into global commerce and finance.
This perspective indicates a transition from mere speculation to something resembling policy consideration. In August 2025, Reuters reported that Chinese authorities were investigating the potential of a yuan-backed stablecoin to enhance its international usage—a noteworthy shift for a nation that has prohibited cryptocurrency trading and mining since 2021.
Allaire has advocated this viewpoint since at least 2023, asserting that stablecoins could surpass central bank digital currencies in facilitating the internationalization of the RMB. At that time, Beijing’s position seemed firmly against it; officials had detained individuals associated with CNHC, an offshore yuan stablecoin, and reiterated their restrictions on virtual currencies later in the year.
In recent years, however, perceptions have shifted; stablecoins are now regarded less as speculative crypto assets and more as essential financial infrastructure for cross-border transactions.
For China to successfully launch a yuan-backed stablecoin, it would be necessary for Beijing to allow full convertibility of the RMB. This implies that foreign entities must be able to exchange yuan freely without stringent government limitations on capital movement or caps on monetary flows into or out of China.
Experts assert that without complete convertibility, creating a yuan-backed stablecoin would not be feasible.
Currently though, capital controls remain fundamental to China’s economic strategy. A stablecoin tied to offshore yuan (CNH) represents significantly different dynamics compared to one linked with onshore yuan (CNY)—the former operates within existing regulations while the latter does not comply with them.
The timeline proposed by Allaire ultimately depends on whether China views stablecoins as an alternative solution or as part of its long-term strategy. While technology can advance rapidly, making policy decisions is invariably more challenging.
Pursuant to current data available today regarding global markets for cryptocurrencies—valued at nearly $315 billion—the majority comprises privately issued dollar-pegged tokens like Tether and USD Coin (USDC).