Beijing Orders Tech Titans to Halt Stablecoin Launches in Hong Kong

Beijing has reportedly instructed several of China’s largest technology firms to pause their plans to issue stablecoins in Hong Kong, a renewed caution toward privately issued digital currencies even beyond the mainland.

According to a report from the Financial Times, regulators from the People’s Bank of China (PBoC) and the Cyberspace Administration of China have advised major firms, including Ant Group, the financial affiliate of Alibaba, and e-commerce heavyweight JD.com, not to proceed with their proposed stablecoin projects.

Both companies had previously urged the PBoC to approve the launch of yuan-pegged stablecoins in Hong Kong, particularly as the city’s new licensing framework for stablecoin issuers came into effect earlier this year. The initiative was viewed by many as a way to boost the international use of the Chinese currency while leveraging Hong Kong’s status as a global financial hub.

However, officials appear to be taking a more conservative approach. Sources cited by the Financial Times said that Beijing remains wary of allowing private companies to issue any form of currency, fearing it could undermine confidence in the country’s central bank digital currency (CBDC), the digital yuan — known as the e-CNY — which has struggled to gain widespread adoption.

PBoC Governor Zhou Xiaochuan highlighted these concerns during a closed-door financial forum in August, warning that stablecoins could pose risks to monetary stability and financial integrity. He cited issues such as over-issuance and leverage arising from post-issuance financial activities.

“Central banks currently have at least two concerns, excessive money issuance without full reserves and the multiplier effect created by derivatives of these assets,” Zhou said, adding that even with new regulatory frameworks like Hong Kong’s Stablecoin Ordinance, safeguards remain “significantly insufficient.”

The decision represents a setback for Ant Group and JD.com, two of the 77 firms that had expressed interest in applying for Hong Kong’s stablecoin license, according to the Hong Kong Monetary Authority (HKMA). The territory has sought to position itself as a digital finance hub, offering a more open environment for crypto and tokenization projects compared to mainland China’s strict prohibitions.

Still, the mainland’s influence remains evident. Earlier this year, Chinese regulators also reportedly urged top Hong Kong brokerages to halt tokenization projects and to refrain from publishing research endorsing stablecoins, reflecting Beijing’s broader strategy to maintain control over the pace and direction of financial innovation.