Wang Yongli, former vice president of the Bank of China: Promoting a stablecoin for the RMB has no advantage both domestically and internationally.

PANews reported on December 5th that Wang Yongli, former vice president of the Bank of China, published an article titled "Why Did China Resolutely Halt Stablecoins?" The article points out that China already possesses a leading global advantage in mobile payments and the digital yuan. Promoting a stablecoin for the yuan offers no advantage domestically and has limited room for development and influence internationally. Furthermore, China should not follow the path of dollar-denominated stablecoins in vigorously promoting the development of both onshore and offshore yuan stablecoins. Following the path of dollar-denominated stablecoins in developing a yuan stablecoin not only fails to challenge the international status of dollar-denominated stablecoins but may even turn the yuan stablecoin into a vassal of dollar-denominated stablecoins, impacting national tax collection, foreign exchange management, and cross-border capital flows, posing a serious threat to the sovereignty and security of the yuan and the stability of the monetary and financial system. Faced with a more acute and complex international situation, China should prioritize national security and exercise high vigilance and strict control over the trading and speculation of crypto assets, including stablecoins, rather than simply pursuing increased efficiency and reduced costs. Of course, while resolutely halting stablecoins and cracking down on virtual currency trading and speculation, we must also accelerate the innovative development and widespread application of the digital yuan at home and abroad, establish the international leading advantage of the digital yuan, forge a Chinese path for the development of digital currency, and actively explore the establishment of a fair, reasonable and secure new international monetary and financial system.

Previously, seven departments, including the National Internet Finance Association of China, issued a risk warning on preventing illegal activities involving virtual currencies . The warning stated that stablecoins currently cannot effectively meet the requirements for customer identification and anti-money laundering, and there is a risk that they may be used for illegal activities such as money laundering, fundraising fraud, and illegal cross-border fund transfers.