China May Introduce Yuan-Backed Stablecoin Within 3-5 Years, Says Circle CEO

According to Circle CEO Jeremy Allaire, China has a significant opportunity to launch a yuan-backed stablecoin, which could happen within the next three to five years as digital currencies become increasingly integrated into global trade and finance. Allaire made these remarks in an interview with Reuters in Hong Kong, marking a shift from a speculative idea to a more policy-aligned concept. This comes after Chinese officials were reported to be exploring a yuan-backed stablecoin in August 2025 to boost international adoption, a notable development for a country that has banned cryptocurrency trading and mining since 2021. Allaire has been advocating for stablecoins as a means to internationalize the RMB since at least 2023, arguing that they could outperform central bank digital currencies. However, for China to introduce a yuan stablecoin, it would need to make the RMB fully convertible, allowing foreigners and markets to freely exchange yuan without strict government restrictions on capital flows. Currently, capital controls remain a crucial aspect of Chinese economic policy, and a stablecoin backed by the offshore yuan (CNH) would be distinct from one backed by the onshore yuan (CNY). The introduction of a yuan stablecoin hinges on whether China views stablecoins as a solution or a commitment, with the technology advancing rapidly, but policy decisions being more challenging. The global stablecoin market is currently valued at nearly $315 billion, with privately issued dollar-pegged tokens like Tether USDT and USD Coin making up the majority of the total value.