China Launches New Initiative to Counter Dollar Dominance with Yuan-Based Stablecoins!

Jakarta, Pintu News – The Chinese government recently announced research funding for the development of stablecoins backed by the yuan, as a strategic move to counter the dominance of the United States dollar in digital finance. The initiative includes the provision of significant research funding and the development of a cross-border crypto monitoring system, marking a major shift in the country’s approach to digital assets.

Research Funding for Yuan-Based Stablecoins

The National Science Foundation of China has allocated between 200,000 yuan and 300,000 yuan to support research into yuan-backed stablecoins. The initiative is being hailed as an important effort to address the adoption challenges of the digital yuan which faces stiff competition from dollar-backed stablecoins.

This research aims to develop policies that can address the global challenges posed by stablecoins. By focusing on developing competitive stablecoins, China hopes to reduce reliance on the US dollar in global trade settlements. This approach also reflects Beijing’s desire to strengthen control over capital flows and ensure domestic economic stability.

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Improved Cross Border Monitoring System

As part of this initiative, China is also targeting the development of a sophisticated monitoring system for yuan-backed stablecoins as well as international crypto flows. This system is expected to enhance the government’s ability to monitor and regulate cross-border crypto transactions, thereby strengthening financial controls.

The development of this monitoring technology is not only aimed at internal security but also to provide Beijing with more effective tools in the face of global digital currency competition. With this system, China’s ambition is to play a more dominant role in the international digital finance ecosystem.

Challenges and Expectations for the Digital Yuan

Despite the Chinese government’s full support, the digital yuan still faces serious challenges in competition with dollar-backed stablecoins. This funding initiative is expected to accelerate the adoption of the digital yuan by addressing some of the key barriers it currently faces.

Moreover, by strengthening the position of the digital yuan through funded research and development, China hopes to reduce the dominance of the US dollar and strengthen the yuan’s position in global trade. This move is also considered critical to maintaining the country’s economic sovereignty and financial security.

Conclusion

This latest initiative from China shows the country’s seriousness in confronting the dominance of the US dollar and marks a new chapter in the digital currency wars. With a structured approach and significant funding, Beijing seems determined to not only secure its economy but also to play a more active role in the global digital finance arena.

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Reference

• Watcher Guru. China Launches Digital Counteroffensive Against Dollar-Backed Stablecoins. Accessed on September 12, 2025