The global financial landscape is undergoing a profound transformation, driven by the rise of digital currencies and shifting geopolitical dynamics. As nations seek greater autonomy in cross-border payments and monetary policy, the dominance of the U.S. dollar—long the cornerstone of international finance—is being challenged. Recent developments in stablecoin regulation, particularly in the United States and Asia, have intensified this trend. While the U.S. moves to cement its leadership through the Genius Act, forward-thinking analysts argue that long-term de-dollarization remains inevitable. In this evolving ecosystem, Renminbi (RMB) stablecoins are emerging as a strategic opportunity to accelerate RMB internationalization, especially via Hong Kong’s newly enacted regulatory framework.
The Genius Act and America’s Strategic Push
In a bid to maintain financial supremacy, the U.S. Senate recently passed the Guiding Emerging National Innovation Using Stablecoins (Genius) Act. This legislation aims to establish a federal framework for dollar-backed stablecoins, requiring issuers to maintain 1:1 reserves in cash, short-term U.S. Treasuries, or government money market funds. By legally anchoring blockchain-based payments to the dollar, the U.S. seeks to reinforce its currency’s dominance in global finance.
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While USD stablecoins currently command over 95% of the global stablecoin market, their expansion may not be sustainable in the long run. Experts warn that rising trade protectionism, geopolitical fragmentation, and growing demand for financial sovereignty will continue to fuel de-dollarization. As more countries develop their own digital currency infrastructure, reliance on the dollar could gradually decline—mirroring broader shifts in global trade and economic power.
The Limits of Dollar Dominance: The Triffin Dilemma Revisited
At the heart of this transformation lies the Triffin Dilemma, a paradox first identified by economist Robert Triffin in 1960. For the dollar to serve as the world’s primary reserve currency, other nations must hold large amounts of it for trade and reserves—requiring the U.S. to run persistent trade deficits. Yet, maintaining confidence in the dollar demands fiscal discipline and a strong domestic economy, which contradicts sustained deficit spending.
This contradiction undermines long-term stability. Despite the short-term boost from regulated stablecoins, the structural weaknesses remain. As CICC (China International Capital Corporation) notes, if countries begin issuing non-dollar stablecoins—pegged to baskets like IMF Special Drawing Rights (SDRs) or regional currencies—the dollar’s reserve status could erode further.
IMF data shows that as of late 2024, the dollar accounted for just 57.80% of global official foreign exchange reserves—the lowest level since records began in 1995. This downward trend reflects a diversifying world order where economic influence is no longer concentrated in a single nation.
Global Regulatory Shifts Pave the Way for Alternatives
Regulatory progress outside the U.S. signals growing momentum for alternative digital payment systems:
- The European Union implemented its Markets in Crypto-Assets (MiCA) regulation in 2024, setting strict standards for stablecoin issuance, transparency, and reserve management.
- The United Kingdom and Singapore have also advanced their regulatory frameworks for stablecoins.
- Most notably, Hong Kong officially enacted its Stablecoin Ordinance in May 2025, with enforcement beginning in August. This law provides a clear legal foundation for issuing and operating licensed stablecoins within one of Asia’s most dynamic financial hubs.
These developments create fertile ground for non-dollar stablecoins, including those backed by the RMB. With robust regulation comes institutional trust—essential for widespread adoption in cross-border commerce and decentralized finance.
Why RMB Stablecoins Are Poised for Growth
According to Tu Yonghong, Deputy Director at the International Monetary Research Institute at Renmin University, RMB stablecoins represent both a challenge and an opportunity in the face of dollar-centric digital finance.
Two key advantages position RMB stablecoins for success:
1. Strong Real Economy Backing
China remains the world’s largest trading nation and second-largest economy. However, the RMB’s share in global payments lags far behind its economic weight—indicating significant untapped potential. Unlike the U.S., which faces the Triffin Dilemma due to its external imbalances, China’s current account surplus and strong export base provide a more sustainable foundation for a globally used digital currency.
2. Leadership in Digital Payments and Fintech
China leads in digital payment innovation, with platforms like Alipay and WeChat Pay setting global benchmarks. Giants such as Alibaba, Tencent, and JD.com have already built mature ecosystems for cross-border e-commerce and microtransactions. These infrastructures can seamlessly integrate RMB stablecoins, enabling fast, low-cost international settlements.
Prof. Li Guoquan from the Singapore University of Social Sciences emphasizes that China’s strengths extend beyond manufacturing into high-growth sectors like electric vehicles (EVs), carbon trading, and digital content exports.
“Imagine a Chinese e-book published globally, allowing derivative works with micropayments collected via RMB stablecoin—this creates a frictionless value flow that empowers small creators while advancing RMB usage,” says Li.
Such use cases demonstrate how tokenized fiat currencies can support new economic models without relying on traditional banking rails.
Hong Kong: The Launchpad for Offshore RMB Stablecoins
As the world’s largest offshore RMB center, Hong Kong is uniquely positioned to lead in RMB stablecoin development. The new Stablecoin Ordinance enables licensed entities to issue transparent, audited digital currencies—opening doors for RMB-pegged tokens.
Moreover, Hong Kong’s integration with mainland China through initiatives like Cross-Border Payment Connect expands real-world utility for digital RMB instruments. These channels allow businesses to settle trade invoices instantly across borders, reducing dependency on SWIFT and correspondent banking.
Tu Yonghong highlights that Hong Kong can serve dual roles: as an extension of offshore dollar markets and as a hub for offshore RMB tokenization. By learning from U.S. regulatory practices while adapting to regional needs, Hong Kong can pioneer a parallel digital payment ecosystem.
Wang Yiliang, former vice president of Bank of China, recommends that regulators consider launching an offshore RMB stablecoin in Hong Kong—initially for use in overseas crypto asset trading and clearing. This would provide critical testing grounds for broader adoption and interoperability with China’s digital RMB (e-CNY) system.
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Toward a Multi-Currency Digital Future
The future of global payments isn’t about replacing one dominant currency with another—it’s about diversification, efficiency, and inclusion. Stablecoins offer a technological breakthrough: they combine the price stability of fiat with the speed and accessibility of blockchain.
As M0-focused designs for digital yuan evolve, Wang urges policymakers to embrace innovations from the stablecoin space—such as yield mechanisms, programmability, and interoperability—to enhance competitiveness against dollar-denominated counterparts.
Ultimately, a pluralistic international monetary system supported by multiple trusted digital currencies—including RMB stablecoins—can deliver greater resilience and fairness.
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Frequently Asked Questions (FAQ)
Q: What is a stablecoin?
A: A stablecoin is a type of cryptocurrency designed to maintain a stable value by being pegged to a reserve asset—such as a fiat currency (like USD or RMB), commodities, or a basket of assets.
Q: How do RMB stablecoins support de-dollarization?
A: By offering an alternative for cross-border transactions outside the dollar system, RMB stablecoins reduce reliance on USD-based infrastructure like SWIFT and help diversify global reserve assets.
Q: Is Hong Kong’s Stablecoin Ordinance effective immediately?
A: Yes, the ordinance was gazetted in May 2025 and will take full effect in August 2025, establishing a licensing regime for stablecoin issuers operating in Hong Kong.
Q: Can RMB stablecoins be used outside China?
A: While subject to capital controls within mainland China, offshore RMB stablecoins issued in jurisdictions like Hong Kong can be used internationally, particularly in trade settlements and digital asset markets.
Q: How does blockchain improve cross-border payments?
A: Blockchain enables near-instant settlement, lower transaction fees, reduced counterparty risk, and greater transparency compared to traditional correspondent banking networks.
Q: Are non-dollar stablecoins a threat to financial stability?
A: With proper regulation—such as reserve requirements and auditing—they can enhance financial stability by increasing competition and reducing systemic overreliance on any single currency.
Core Keywords: RMB stablecoin, de-dollarization, RMB internationalization, digital currency, cross-border payments, blockchain technology, Hong Kong Stablecoin Ordinance