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

According to Circle CEO Jeremy Allaire, China may launch a yuan-backed stablecoin in the next three to five years, as digital currencies become increasingly integral to global trade and finance. Allaire made these comments to Reuters in Hong Kong, highlighting the vast potential for a yuan stablecoin. This prediction marks a significant shift from a speculative idea to a more policy-oriented approach. In August 2025, Reuters reported that Chinese officials were exploring the possibility of a yuan-backed stablecoin 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 promote RMB internationalization since at least 2023, arguing that they could outperform central bank digital currencies. At the time, Beijing's stance seemed firmly opposed, with authorities arresting individuals linked to an offshore yuan stablecoin and reiterating restrictions on virtual currencies. However, in recent years, stablecoins have started to be viewed as financial infrastructure for cross-border settlement rather than speculative crypto products. For China to successfully launch 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. Without full convertibility, experts believe a yuan stablecoin would be unfeasible. Currently, capital controls remain a crucial aspect of Chinese economic policy, and a stablecoin backed by the offshore yuan is distinct from one backed by the onshore yuan. Allaire's predicted timeline depends on whether China views stablecoins as a solution or a commitment. While the technology can advance rapidly, the policy decision remains the more challenging aspect. The global stablecoin market is currently valued at nearly $315 billion, with privately issued dollar-pegged tokens such as Tether USDT and USD Coin making up the majority of the total value.