🇨🇳 Shanghai Reconsiders Crypto: A Surprising Turn Toward Stablecoins. By ChainFabricNews

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Image source: Live Bitcoin News

 In a move that has caught the global crypto community’s attention, Shanghai is showing signs of shifting its strict stance on digital currencies. While China officially banned cryptocurrency activities like trading and mining back in 2021, a recent high-level government meeting in Shanghai suggests the tide may be turning—at least when it comes to stablecoins.

📍 What’s Happening?

On July 10–11, around 60 to 70 Chinese officials gathered in Shanghai for a closed-door discussion about the future of digital currencies. The meeting, organized by the city’s State-owned Assets Supervision and Administration Commission, focused heavily on how China could potentially use yuan-backed stablecoins to modernize its financial system—without lifting its crypto ban entirely.

This is a big deal because it shows that while China is still very cautious about cryptocurrencies like Bitcoin and Ethereum, it’s starting to explore the idea of using blockchain technology for more controlled, government-friendly digital assets.

💴 The Idea Behind a Yuan-Pegged Stablecoin

Why all this talk about stablecoins? Well, most stablecoins today—like USDT or USDC—are tied to the U.S. dollar. Chinese tech giants like JD.com and Ant Group believe that a stablecoin pegged to the Chinese yuan could offer a serious alternative. It would make cross-border payments faster and smoother and even help the Chinese yuan become more recognized internationally.

These companies are also hoping to test such stablecoins in places like Hong Kong, where regulations are a bit more open. In fact, Hong Kong is launching its own stablecoin licensing framework in August 2025, which could become a testing ground for these ideas.

🌐 Why This Matters Globally

Stablecoins are gaining traction all over the world. In the U.S., even big names like Amazon and Walmart are exploring their own digital coins. Experts say the global stablecoin market could explode from around $250 billion today to over $2 trillion in the next few years. So, it’s not surprising that Shanghai wants to get ahead of the curve.

🧭 A Careful Balancing Act

That said, Chinese regulators are still very cautious. Pan Gongsheng, Governor of the People’s Bank of China, has warned about the risks stablecoins can pose to financial control and economic stability. So, don’t expect China to fully embrace crypto anytime soon.

Instead, this looks like the beginning of a carefully managed experiment—one that could eventually change how the country handles digital finance. If successful, a yuan-backed stablecoin might one day sit alongside China’s central bank digital currency (the e-CNY), offering more flexible options for international trade and digital payments.

✨ What This Could Mean for the Future

  • A New Digital Yuan Era: Shanghai might lead the way in making the yuan more global.

  • Tech and Finance Merge: Chinese companies are clearly ready to innovate in the digital space.

  • China’s Global Push: This is another step in China’s long-term goal to reduce reliance on the U.S. dollar.

Final Thoughts:
While China isn’t dropping its crypto ban anytime soon, Shanghai’s interest in stablecoins shows that innovation is still alive—even in a tightly regulated environment. Whether this leads to a broader shift in policy or just a small pilot program, it’s a story worth watching closely.

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