The Chinese government has prohibited centralized crypto assets for a considerable time. Nonetheless, Jeremy Allaire (the chief executive officer of the stablecoin issuer Circle) is of the view that the country can leverage stablecoins. As per the executive, stablecoins have the potential to make a significant contribution to promoting the digital yuan of China.
Circle’s Jeremy Allaire Thinks China Could Leverage Yuan Stablecoin for More Benefits Than Its CBDC
Allair, whose company issues the prominent dollar-pegged stablecoin called USD Coin (USDC), said that a stablecoin backed by renminbi (RMB) might be the best bet for China to increase the adoption of the country’s national currency. The executive mentioned this in an interview conducted by the South China Morning Post.
According to the reports, he disclosed that if ultimately the authorities in China intend to offer the free usage of the RMB in commerce and trade around the globe, they may move toward stablecoins as this is a better option as compared with the central bank digital currency (CBDC). Back in the year 2021, the Chinese government banned the utilization of crypto assets.
In addition to this, the authorities simultaneously began endeavors to test as well as issue its separate central bank digital currency (CBDC) named e-CNY. In January this year, the country’s authorities pointed out that nearly thirteen billion e-CNY tokens were being circulated. It is noteworthy that the website of the digital yuan offers a very optimistic view of the CBDC.
The website says that the CBC will replace the stablecoin Tether (USDT), the USD, as well as the rest of the stablecoins. On the other hand, it also claimed that the CBDC will not turn into a stablecoin. The web portal enables consumers to exchange crypto assets to e-CNY. They can do this with MetaMask Swap or the separate conversion forum thereof.
The executive moved on to conclude that the country is likely cold toward the utilization of decentralized crypto assets. Additionally, Allaire also highlighted the progressive approach taken by Hong Kong toward the crypto world. In Allaire’s words, this could indicate subversive support provided by the mainland.
The Executive Says the Governments Operating on CBDC Projects Do Not Support sovereignty and decentralization
Moreover, the CEO also brought to the front that diverse governments took positive moves to create CBDCs that are more advanced than legacy technology with the use of the latest distributed ledger technology. Nevertheless, the executive added, the respective development should not be considered a step toward adopting self-sovereign and decentralized systems.
The digital yuan of China is making progress across the country’s borders. The former reports have revealed that the crypto-friendly DBS Bank of Singapore has created a merchant solution for e-CNY to permit businesses in China to get payments in the Chinese CBDC. This also permits consumers from China to obtain e-CNY as well as perform settlements straight to the bank accounts dealing with the renminbi.
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