Former People's Bank of China Governor Warns of Risks of Yuan-Based Stablecoins

Former People's Bank of China Governor Warns of Risks of Yuan-Based Stablecoins

Warning About Yuan-Based Stablecoins: A Former Governor of the People’s Bank of China Raises Concerns

A former governor of the People's Bank of China has warned against calls for the Chinese government to approve yuan-based stablecoins. In his argument he highlights the potential risks associated with such a decision.

Stablecoins pegged to fiat currencies such as the Chinese Yuan could pose several challenges in China's current economic and financial landscape. The concerns relate, among other things, to the stability of the financial system, the possible circumvention of regulations and the impact on the central bank's monetary policy control.

The governor emphasizes that the introduction of yuan-based stablecoins must be carefully considered so as not to jeopardize the integrity of the existing financial system. At a time when digital currencies are gaining importance worldwide, it is crucial to create the right framework conditions to minimize risks and ensure a stable economic environment.

Given these warnings, the discussion surrounding yuan-based stablecoins will continue to be relevant as the Chinese government and the People's Bank of China closely monitor developments in the digital currency space.