Two of China’s largest technology firms, Ant Group and JD.com, have reportedly paused their plans to issue stablecoins in Hong Kong after receiving regulatory signals from Beijing cautioning against private entities engaging in currency issuance. The move underscores China’s cautious approach to privately managed digital assets, even as it accelerates the rollout of its state-backed digital yuan.
Stablecoin Projects Put on Hold
Both Ant Group — the fintech arm of Alibaba — and JD.com had been exploring stablecoin initiatives aimed at facilitating cross-border transactions and enhancing digital commerce through Hong Kong’s more open financial system. The city has recently introduced a regulatory framework to supervise stablecoins — cryptocurrencies pegged to fiat currencies like the U.S. dollar or yuan — in an attempt to balance innovation with financial oversight.
Regulatory Intervention from Beijing
Sources familiar with the matter revealed that mainland regulators intervened, warning that private issuance of any currency-like digital asset could threaten China’s monetary sovereignty and financial stability. This directive effectively prompted both companies to suspend their projects pending further guidance from Beijing.
The decision reflects China’s long-standing policy of maintaining strict state control over money creation and circulation. While authorities have encouraged the use of blockchain technology for enterprise solutions, they remain firm in distinguishing between state-backed digital currencies and privately issued tokens.
Hong Kong’s Fintech Balancing Act
The pause also highlights the delicate position of Hong Kong as it strives to become a leading global hub for digital finance under the “one country, two systems” principle. Although local regulators have been open to fostering innovation in blockchain and virtual assets, any large-scale stablecoin venture by mainland Chinese corporations inevitably attracts scrutiny from Beijing.
Shift Toward Supporting the Digital Yuan
Analysts believe the move represents a broader recalibration of China’s fintech strategy. Instead of competing with the digital yuan (e-CNY), major technology firms like Ant Group and JD.com are expected to redirect their resources toward supporting government-led initiatives and developing compliant, blockchain-based payment systems aligned with national policy.
Reinforcing State Control Over Currency
Although neither company has issued an official statement, the shelving of their stablecoin plans sends a clear message: China intends to keep control of currency issuance firmly in state hands. As the global digital economy evolves, Beijing’s approach demonstrates its preference for innovation under regulation rather than financial autonomy for private enterprises.
