Hong Kong could serve as a stablecoin test bed to boost the internationalisation of the yuan as Beijing puts more focus on the digital version of its currency, according to the chairman and CEO of HashKey Group.
“Due to its ‘one country, two systems’ characteristics, Hong Kong’s stablecoins can serve as a testing ground for the mainland, providing both experience and lessons,” said Xiao Feng, who heads one of the city’s licensed cryptocurrency exchange operators, on Wednesday.
Earlier in the day, People’s Bank of China (PBOC) governor Pan Gongsheng spoke about stablecoins – digital tokens pegged to a reference asset like a fiat currency – at the high-profile Lujiazui Forum.
Pan said that emerging technologies such as blockchain and distributed ledgers were rapidly driving the development of central bank digital currencies (CBDCs) and stablecoins, reshaping traditional payment systems and significantly shortening cross-border payment chains while posing “significant challenges to financial regulation”.
Pan added that innovations like smart contracts and decentralised finance would continue to advance the evolution of cross-border payment systems.
HashKey’s Xiao viewed the speech as a “positive sign” and that stablecoins could be on Beijing’s radar.
