Chinese Regulators Instruct Brokerages to Cease Promotion of Stablecoins to Mitigate Market Speculation and Fraud Risks

According to a report by Bloomberg citing informed sources, Chinese regulatory authorities have instructed local brokerages and other institutions to cease the publication of research reports related to stablecoins or to hold promotional seminars for stablecoins, in an effort to control the hype surrounding these assets and prevent market instability.

Informed sources revealed that several large brokerages and think tanks received guidance from financial regulatory authorities between late July and early this month, instructing them to cancel scheduled seminars on stablecoins and to stop publishing related research content. The regulatory bodies are also concerned that stablecoins could be exploited by criminals in mainland China, potentially becoming a new tool for fraud.

China has implemented a comprehensive ban on cryptocurrency-related transactions; however, recent official statements have sparked speculation that the country’s attitude towards the crypto industry may be becoming more lenient. Authorities have also approved Hong Kong’s development as a digital asset center. The Hong Kong stablecoin regulations officially took effect this month, significantly increasing interest and attention from mainland Chinese enterprises.

Christopher Wong, a foreign exchange strategist at OCBC Bank in Singapore, stated: