{"id":504882,"date":"2025-10-30T12:30:31","date_gmt":"2025-10-30T12:30:31","guid":{"rendered":"https:\/\/cryptoslate.com\/?p=504882"},"modified":"2025-11-04T12:21:36","modified_gmt":"2025-11-04T12:21:36","slug":"the-308-billion-question-can-stablecoins-thrive-amid-china-ban","status":"publish","type":"post","link":"https:\/\/cryptoslate.com\/the-308-billion-question-can-stablecoins-thrive-amid-china-ban\/","title":{"rendered":"The $308B question: Will stablecoins thrive globally without China?"},"content":{"rendered":"<p>China has again made its position on stablecoins unmistakably clear.<\/p>\n<p>At a recent financial policy <a href=\"http:\/\/www.pbc.gov.cn\/goutongjiaoliu\/113456\/113469\/5880408\/index.html\">forum<\/a>, Pan Gongsheng, governor of the People\u2019s Bank of China (PBoC), described stablecoins as a \u201cnew source of vulnerabilities\u201d within the global financial system. He warned that they could undermine smaller economies\u2019 monetary sovereignty and enable illicit financial flows.<\/p>\n<p>According to him, these assets &#8220;amplify loopholes in global financial regulation, such as money laundering, illegal cross-border fund transfers, and terrorist financing.&#8221; He also stressed that most stablecoin projects fail to meet basic compliance standards such as customer identification and anti-money-laundering checks.<\/p>\n<p>His remarks reaffirm China\u2019s decade-long stance: private digital currencies and stablecoins remain off-limits, even as Beijing continues to <a href=\"https:\/\/cryptoslate.com\/china-calls-for-digital-yuan-expansion-amid-us-stablecoin-dominance-concerns\/\">advance its digital yuan (e-CNY)<\/a> as a state-controlled alternative.<\/p>\n<p>Yet as the rest of the world accelerates toward tokenized finance, China\u2019s absence raises the pressing question of whether stablecoins can truly thrive without the world\u2019s largest fintech economy.<\/p>\n<h2>A global market moving without Beijing<\/h2>\n<p>For now, the answer appears to be yes.<\/p>\n<p>While China doubles down on restrictions, global stablecoin adoption has surged. According to DeFiLlama <a href=\"https:\/\/defillama.com\/stablecoins\">data<\/a>, the sector\u2019s total capitalization recently crossed $308 billion, expanding by nearly $100 billion since January.<\/p>\n<p>At the same time, a report from A16z shows that the sector's transaction volumes surpassed $46 trillion over the past year, rivaling established payment giants such as Visa when adjusted for legitimate activity.<\/p>\n<figure id=\"attachment_504989\" aria-describedby=\"caption-attachment-504989\" style=\"width: 2560px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-504989\" src=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2025\/10\/G331Ht4X0AE3ljQ-scaled.jpg\" alt=\"Stablecoins Volume\" width=\"2560\" height=\"1440\" srcset=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2025\/10\/G331Ht4X0AE3ljQ-scaled.jpg 2560w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2025\/10\/G331Ht4X0AE3ljQ-300x169.jpg 300w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2025\/10\/G331Ht4X0AE3ljQ-1024x576.jpg 1024w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2025\/10\/G331Ht4X0AE3ljQ-768x432.jpg 768w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2025\/10\/G331Ht4X0AE3ljQ-1536x864.jpg 1536w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2025\/10\/G331Ht4X0AE3ljQ-2048x1152.jpg 2048w\" sizes=\"(max-width: 2560px) 100vw, 2560px\" \/><figcaption id=\"caption-attachment-504989\" class=\"wp-caption-text\">Stablecoins Volume (Source: A16z)<\/figcaption><\/figure>\n<p>Chris Dixon, a partner at venture capital firm A16z, <a href=\"https:\/\/x.com\/cdixon\/status\/1981012805101973813\">said<\/a>:<\/p>\n<blockquote><p>&#8220;Stablecoins have gone mainstream. [They] have found product-market fit, rivaling the world\u2019s largest payment networks in transaction volume.&#8221;<\/p><\/blockquote>\n<p>This milestone is unsurprising considering that governments across Asia, which once echoed Beijing\u2019s caution, are moving in the opposite direction.<\/p>\n<p>Japan has legalized fiat-backed stablecoins this year, with fintech firm JPYC Inc. launching the first fully compliant yen-denominated token on <a href=\"https:\/\/cryptoslate.com\/coins\/ethereum\/\">Ethereum<\/a>, <a href=\"https:\/\/cryptoslate.com\/coins\/avalanche\/\">Avalanche<\/a>, and <a href=\"https:\/\/cryptoslate.com\/coins\/polygon\/\">Polygon<\/a>.<\/p>\n<p>Moreover, other leading jurisdictions, including South Korea, Hong Kong, and Singapore, are <a href=\"https:\/\/cryptoslate.com\/asian-powerhouses-japan-and-south-korea-advance-stablecoin-regulatory-efforts\/\">preparing similar frameworks<\/a> to license issuers and protect consumers.<\/p>\n<p>In the West, the United States is pushing toward formal oversight through <a href=\"https:\/\/cryptoslate.com\/trump-signs-genius-act-into-law-activating-americas-first-regulatory-framework-for-stablecoins\/\">legislation such as the GENIUS Act,<\/a> while major institutions, from PayPal to <a href=\"https:\/\/cryptoslate.com\/can-solana-handle-100m-western-union-users-sending-dollar-tokens-worldwide\/\">Western Union, are rolling out their own tokenized settlement assets.<\/a><\/p>\n<p>These moves are transforming stablecoins from speculative tools into regulated infrastructure for payments, remittances, and on-chain treasury management.<\/p>\n<p>That momentum suggests the market can function and flourish without China\u2019s participation because the technology has matured beyond its early crypto-native roots.<\/p>\n<p>Essentially, stablecoins now act as the core liquidity layer of decentralized finance and the backbone of on-chain commerce, enabling instant settlement across thousands of platforms.<\/p>\n<h2>Thriving without China: But not entirely free from it<\/h2>\n<p>Yet even as the industry expands, China\u2019s influence lingers.<\/p>\n<p>The Asian country's market size, cross-border trade capacity, and digital-payment infrastructure remain unmatched. <a href=\"https:\/\/cryptoslate.com\/ethereum-to-onboard-1-4b-new-users-as-chinese-alipay-megacorp-launches-own-l2\/\">Platforms such as Alipay<\/a> and WeChat Pay process more transactions annually than many entire regions combined. Excluding that ecosystem limits stablecoins\u2019 reach and potential scale.<\/p>\n<p>In practice, the ban has not erased stablecoin activity in China. Instead, it has merely pushed it underground.<\/p>\n<p>Chinese investors and businesses still use dollar-pegged tokens like <a href=\"https:\/\/cryptoslate.com\/coins\/tether\/\">USDT<\/a> through offshore exchanges and private OTC desks to move funds internationally or hedge against yuan volatility.<\/p>\n<p>Despite official restrictions, stablecoins remain a quiet instrument of capital mobility within Chinese networks.<\/p>\n<p>This underground usage illustrates how the thriving sector could benefit from China\u2019s eventual inclusion in the technology.<\/p>\n<p>A fully integrated Chinese presence, whether through regulated participation or interoperability between the e-CNY and compliant stablecoins, would link the world\u2019s largest trade economy to blockchain-based payments. This would undoubtedly complete the network effect that stablecoins currently lack.<\/p>\n<p>For now, however, two parallel systems are emerging: an open, market-driven ecosystem led by dollar-backed tokens, and a closed, sovereign digital-currency model built around the e-CNY.<\/p>\n<h2>A necessary absence?<\/h2>\n<p>China\u2019s decision to stand apart may, paradoxically, strengthen the case for decentralized finance and stablecoins.<\/p>\n<p>By refusing to integrate, Beijing is forcing the rest of the world to build independently. As a result, this process has already created a more diversified, regulation-aware, and institutionally supported market.<\/p>\n<p>Stablecoins have become indispensable to global liquidity, powering decentralized exchanges, tokenized bond markets, and <a href=\"https:\/\/cryptoslate.com\/how-tethers-127b-in-us-treasuries-will-hit-top-5-foreign-holders-by-2033\/\">US Treasury instruments<\/a>. Their growth has continued despite regulatory uncertainty, cyberattacks, and central-bank skepticism.<\/p>\n<p>So, each expansion reinforces their staying power and proves that the concept of a borderless digital dollar can survive without China\u2019s approval.<\/p>\n<p>Still, the long-term picture remains nuanced.<\/p>\n<p>Without China, stablecoins lose access to one of the largest pools of fintech innovation and global trade settlement. With it, they could achieve true interoperability between Western and Eastern payment systems.<\/p>\n<p>For now, the market is proving that thriving without China is possible.<\/p>\n<p>However, thriving globally may be much more difficult because the absence of the world\u2019s most significant digital economy limits scale.<\/p>\n<p>Yet the quiet participation of Chinese investors shows that even a strict policy can\u2019t suppress the appeal of programmable money.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>China has again made its position on stablecoins unmistakably clear. At a recent financial policy forum, Pan Gongsheng, governor of the People\u2019s Bank of China (PBoC), described stablecoins as a \u201cnew source of vulnerabilities\u201d within the global financial system. He warned that they could undermine smaller economies\u2019 monetary sovereignty and enable illicit financial flows. According [&hellip;]<\/p>\n","protected":false},"author":720,"featured_media":504995,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[35,77968,77911,11,32631],"tags":[76807,75695],"post_folder":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v21.9 (Yoast SEO v21.9.1) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Can Stablecoins Thrive Without China?<\/title>\n<meta name=\"description\" content=\"The international stablecoin market flourishes, but China&#039;s absence leaves a significant gap in fintech innovation.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/cryptoslate.com\/the-308-billion-question-can-stablecoins-thrive-amid-china-ban\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The $308B question: Will stablecoins thrive globally without China?\" \/>\n<meta property=\"og:description\" content=\"The international stablecoin market flourishes, but China&#039;s absence leaves a significant gap in fintech innovation.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/cryptoslate.com\/the-308-billion-question-can-stablecoins-thrive-amid-china-ban\/\" \/>\n<meta property=\"og:site_name\" content=\"CryptoSlate\" \/>\n<meta property=\"article:published_time\" content=\"2025-10-30T12:30:31+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2025-11-04T12:21:36+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2025\/10\/china-stablecoin.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"630\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Oluwapelumi Adejumo\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cryptoslate\" \/>\n<meta name=\"twitter:site\" content=\"@cryptoslate\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Oluwapelumi Adejumo\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"NewsArticle\",\"@id\":\"https:\/\/cryptoslate.com\/the-308-billion-question-can-stablecoins-thrive-amid-china-ban\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/cryptoslate.com\/the-308-billion-question-can-stablecoins-thrive-amid-china-ban\/\"},\"author\":{\"@type\":\"Person\",\"@id\":\"https:\/\/cryptoslate.com\/author\/oluwapelumi-adejumo\/#person\",\"name\":\"Oluwapelumi Adejumo\",\"url\":\"https:\/\/cryptoslate.com\/author\/oluwapelumi-adejumo\/\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/cryptoslate.com\/author\/oluwapelumi-adejumo\/\"},\"image\":{\"@type\":\"ImageObject\",\"@id\":\"https:\/\/cryptoslate.com\/author\/oluwapelumi-adejumo\/#authorimage\",\"url\":\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2025\/12\/profile-photo-oluwapelumi-adejumo-300x300.jpg\",\"contentUrl\":\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2025\/12\/profile-photo-oluwapelumi-adejumo-300x300.jpg\",\"caption\":\"Oluwapelumi Adejumo\"},\"jobTitle\":\"Senior Reporter\",\"description\":\"Oluwapelumi values Bitcoin's potential. 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