Issuing a stablecoin pegged to the offshore yuan in Hong Kong may be more feasible than in mainland China due to the latter’s capital controls, a central bank adviser has said.
The comments from Huang Yiping, also dean of Peking University’s National School of Development, came as worries arise in Beijing’s policy circles that Washington could gain an upper hand through the cryptocurrency offshoot as a means of consolidating US dollar dominance.
“As China’s capital account is not fully liberalised, it would be very difficult to roll out a stablecoin domestically,” he told financial news outlet Yicai.com on Wednesday.
Huang, an influential figure in his second stint at the People’s Bank of China’s monetary policy committee, acknowledged Hong Kong’s speedy progress in this area.
“The issue with issuing a stablecoin in Hong Kong is that if it’s pegged to the Hong Kong dollar, which in turn is pegged to the US dollar – so ultimately, it’s the US dollar that plays the foundational role,” Huang said.
