The global competition to digitize national currencies is intensifying, with new stablecoins tied to the Chinese yuan and South Korean won debuting this week.
In Hong Kong, fintech firm AnchorX unveiled AxCNH, the first regulated stablecoin linked to the offshore Chinese yuan (CNH). The token, announced during the Belt and Road Summit, is designed for cross-border trade between China and the countries tied to its massive infrastructure initiative.
The move follows Beijing’s recent openness toward allowing stablecoins in international markets, even as domestic crypto activity remains tightly controlled.
One day later, digital asset infrastructure company BDACS launched KRW1, a stablecoin pegged to the South Korean won. Both projects are built as overcollateralized tokens, fully backed by fiat reserves or government bonds to maintain their pegs.
The launches highlight how stablecoins have shifted from experimental fintech products to instruments of geo-economic strategy. By placing national currencies on blockchains, governments can expand demand for their money abroad, offering faster settlement than legacy payment networks and bypassing capital controls that limit liquidity in traditional systems.
That demand has implications for inflation and sovereign debt. Wider usage of fiat-backed stablecoins increases currency circulation internationally, helping offset the inflationary drag of money printing. It also creates indirect demand for government debt, since issuers back their tokens with cash and treasuries.
Tether and Circle, for example, have become some of the world’s largest holders of U.S. Treasury bills, with Tether now surpassing entire countries such as Canada and Germany.
The backdrop is a world grappling with record debt — U.S. obligations alone recently topped $37 trillion. Russian presidential advisor Anton Kobyakov has suggested Washington is already relying on a mix of stablecoins and gold to maintain global faith in the dollar.
With Asia now rolling out yuan- and won-pegged digital currencies, the question is no longer whether stablecoins are here to stay, but which nations will succeed in turning them into tools of monetary power.
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Alex is an experienced financial journalist and cryptocurrency enthusiast. With over 8 years of experience covering the crypto, blockchain, and fintech industries, he is well-versed in the complex and ever-evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His approach allows him to break down complex ideas into accessible and in-depth content. Follow his publications to stay up to date with the most important trends and topics.
Source: https://coindoo.com/china-backs-offshore-yuan-stablecoin-to-power-belt-and-road-trade/