China Curbs Promotion of Stablecoins Amid Fraud Concerns

Chinese regulators have directed local brokers and organizations to halt the endorsement and dissemination of research on stablecoins to prevent potential financial instability. This move is also aimed at curbing the use of stablecoins in fraudulent activities. The 2021 cryptocurrency ban remains enforced in mainland China.

In a decisive move to address financial stability concerns, Chinese regulators have instructed local brokers and other entities to cease the publication and promotion of research on stablecoins. Bloomberg News reported this directive is aimed at averting instability in the asset class.

According to sources familiar with the situation, some brokerages and think tanks received instructions from market regulators earlier this month to cancel planned seminars and discontinue research distribution on stablecoins. The move comes amid fears that stablecoins could be exploited as tools for fraudulent activities in China.

While China's comprehensive ban on cryptocurrency activity remains in force, Hong Kong is positioning itself as a global digital asset hub with recent legislative developments. As the People's Bank of China and the China Securities Regulatory Commission have yet to comment, the implications of these moves remain to be fully seen.

(With inputs from agencies.)