2025-03-24
China is stepping up efforts to
internationalize its digital yuan (e-CNY), aiming to counter the growing global
dominance of U.S. dollar-backed stablecoins like USDT and USDC.
Zhang Ming, deputy director at China’s
National Finance and Development Laboratory, warned that dollar-pegged
stablecoins—now making up nearly 90% of the $236 billion stablecoin
market—could further entrench U.S. monetary dominance if they’re fully integrated
into global credit and digital ecosystems.
He called on China to expand the
digital yuan’s reach beyond retail transactions. Specifically, he urged
policymakers to extend coverage from M0 (cash) to M1 (cash + demand
deposits) and even M2 (all deposits) to make it a viable alternative
in both domestic and international financial systems.
Zhang also proposed boosting the
development of RMB-backed stablecoins and increasing digital token use
across Chinese online platforms, combining sovereign credit with global
usability.
The report reflects broader
geopolitical tensions in digital finance. While the U.S. embraces stablecoins
to strengthen dollar hegemony,
China—and increasingly Europe—see this
as a challenge to monetary sovereignty.
Zhang’s position a multipolar
digital currency world, in his view is better than a U.S.-dominated one.
