Author: Shen Jianguang, Zhu Taihui, Wang Ruohan
Abstract
The new US government's cryptocurrency policy framework has returned to the main line of "supporting innovative development". The bill clearly reflects the US's intention to dominate the development of the global stablecoin market
Recently, the US Senate passed the "National Innovation Act to Guide and Establish the United States Stablecoin" (hereinafter referred to as the "Stablecoin GENIUS Act") and forwarded it to the House of Representatives for deliberation. Although it is not the final version, the main content of the "Stablecoin GENIUS Act" is largely consistent with the "Stablecoin Act" proposed by the House of Representatives, and it is expected that there will be no major adjustments to the subsequent thinking framework.
Analyzing the core content of the Stablecoin GENIUS Act and combining the information we have obtained from recent communications with relevant institutions in the United States, the new U.S. government's cryptocurrency policy framework has returned to the main line of "supporting innovative development". The bill clearly reflects the United States' intention to dominate the development of the global stablecoin market: it is necessary to achieve both the dominance of the U.S. dollar stablecoin and the dominance of U.S. issuers.
Combined with the rapid development trend of the global stablecoin market in recent years, as well as the recent legislative plans of major countries around the world such as the United Kingdom, Australia, South Korea, Turkey, and Argentina, the policy considerations of various countries for stablecoins are no longer a question of whether to develop or not, but a question of how to develop.
Under such market and policy trends, it is recommended that relevant Chinese departments comprehensively analyze the technical characteristics and functional attributes of stablecoins, clarify the relationship between stablecoins and encrypted assets, central bank digital currencies, RMB internationalization, and prevention and control of illegal cross-border financial activities, eliminate related misunderstandings, and design and launch China's own stablecoin development plan. In light of China's specific national conditions, it is recommended that China first support the Hong Kong Special Administrative Region to pilot the launch of offshore RMB stablecoins as soon as possible, and then follow the gradual model of "first offshore abroad and then offshore domestically" to promote the development of offshore RMB stablecoins from the Hong Kong Special Administrative Region to the mainland's free trade zones and free trade ports, providing a new engine for the internationalization of the RMB.
Restrictions on Issuance by Overseas Entities
The Stablecoin GENIUS Act clearly states that "payment stablecoins" are digital assets, issued for payment or settlement purposes, redeemable at a fixed face value (such as $1), and not securities or commodities; at the same time, requirements are put forward for payment stablecoin issuers: they must be US registered entities and belong to one of the following three types of institutions - subsidiaries of insured depository institutions, federally approved non-bank entities, and state-approved issuing entities. At the same time, the Act imposes strict restrictions on foreign issuers entering the US market: they must be registered with the US Office of the Comptroller of the Currency (OCC) and meet strict compliance requirements. When deciding whether to approve the registration of an overseas entity, the OCC will consider multiple factors, including assessing whether the regulatory framework of the overseas issuer's country is comparable, the issuer's financial and management resources in the United States, the information submitted to the OCC, potential financial stability risks and illegal financial risks; at the same time, the bill also proposes to implement a reciprocal policy with the regulatory authorities of overseas issuers, that is, the overseas regulatory authorities support the US issuing entity to issue US dollar stablecoins in the country.
Although requiring stablecoin issuers to be localized is a trend in global stablecoin regulation, the requirements of the United States are still very different. The stablecoin bills issued by the European Union, the United Arab Emirates and other places require stablecoin issuers to set up entities in their own countries/regions, while also restricting the scope and amount of stablecoin use. For example, the European Union's Crypto-Asset Market Regulation Act (MiCA) stipulates that only euro stablecoins can be used for daily goods and services payments, and when the daily trading volume of the asset reference token (ART) in a single currency area exceeds 1 million or the transaction amount reaches 200 million euros, the issuance of the ART must be stopped. However, while the United States' Stablecoin GENIUS Act imposes localization requirements on stablecoin issuers, it does not restrict the supported currencies, scope of use, and scale of stablecoins. This is because the current share of US dollar stablecoins in the global stablecoin market exceeds 95%. Issuers in the United States will naturally issue US dollar stablecoins, and the use of stablecoins in daily commodity and service transactions will not weaken but strengthen the sovereignty and international status of the US dollar.
Affected by the localization orientation of the issuers of stablecoins supported by the bill, the world's leading stablecoin issuers and cryptocurrency exchanges have gone to the United States to set up entities. Recently, Tether, the world's largest issuer of USDT (Tether), has made it clear that it is actively considering creating a new stablecoin registered in the United States; the cryptocurrency payment platform MoonPay announced the establishment of a new US headquarters in New York as the core hub for US business operations. Prior to this, the crypto exchange OKX established a regional headquarters in California while promoting the launch of centralized crypto exchanges and wallets in the United States. In addition, Crypto America recently disclosed that at least 15 cryptocurrency and fintech companies are applying for banking licenses from the Office of the Comptroller of the Currency (OCC) in order to conduct business in compliance with regulations in the United States in the future.
Technical requirements for issuers
In order to maintain financial stability and protect consumer rights, the Stablecoin GENIUS Act provides clear capital, liquidity and risk management requirements for stablecoin issuers, and explicitly proposes to protect the priority claim rights of stablecoin holders in the event of the issuer's bankruptcy, and also increases the requirements for the Financial Stability Oversight Council (FSOC) to assess stablecoin-related risks in its annual financial stability report. More importantly, the Act requires issuers to have the corresponding technical capabilities to comply with regulatory requirements and administrative orders to seize, freeze, destroy or prevent the transfer of issued stablecoins.
Stablecoins are issued and traded based on blockchains, and have the characteristics of decentralized transactions, globalization, and irrevocability, which makes the supervision of illegal financial activities such as anti-money laundering and anti-terrorist financing more complicated. Judging from the previous regulatory policies of countries and regions such as the European Union, Singapore, and Hong Kong, China, it has become a global trend to transplant the anti-money laundering and anti-terrorist financing requirements for traditional financial institutions and stock exchanges to the field of stablecoins and encrypted assets, comply with the standards of the Global Financial Action Task Force (FATF), and implement the "Travel Rule".
But on this basis, the "Stablecoin GENIUS Act" embodies the regulatory concept of using emerging technologies to prevent potential illegal financial risks behind stablecoin transactions. On the one hand, the bill regards issuers as the "first responsible person" for anti-money laundering and combating illegal financial activities, emphasizing that all stablecoin issuers must have the technical ability to combat illegal financial activities in accordance with regulatory requirements, and provides relevant civil fines and criminal penalties. On the other hand, "regulation cannot lag behind the application of technological innovation", requiring the US Financial Crimes Enforcement Network (FinCEN) to develop new tools to monitor illegal encryption activities, review issuers' compliance plans, and require issuers to formally prove that they have an effective anti-money laundering and sanctions framework while formulating new anti-money laundering rules for digital asset activities. Prior to this, the US Securities and Exchange Commission (SEC) also clearly expressed its support for the regulatory sandbox mechanism to evaluate the risks of stablecoins, bond tokenization, etc. and the applicability of regulatory tools.
Enlightenment for China
Although the Stablecoin GENIUS Act still needs to be reviewed by the U.S. House of Representatives, some clauses may be further amended, or face many challenges in the implementation process, considering that the main content of the bill is largely consistent with the Stablecoin Act proposed by the House of Representatives, the main policy line of the United States supporting "stablecoin compliance and innovative development" will not change easily, and the intention of using the U.S. dollar stablecoin to support the strengthening of the U.S. dollar in the international monetary system is more obvious. At the same time, the Stablecoin GENIUS Act requires stablecoin issuers and regulators to use technological innovation to prevent potential risks in the application of technological innovation, and to regulate the development of stablecoins with a development perspective, which reflects a strong "technological neutrality" concept and is also worthy of attention from all countries.
At the same time, with the continuous growth of the stablecoin market size and the number of users, and the continuous expansion of the integration and development with the payment system, banking institutions and capital markets, the stablecoin policies of various countries have also changed significantly. At present, the European Union, Japan, Singapore, the United Arab Emirates, Hong Kong, China and other countries and regions have issued bills to regulate the innovative development of stablecoins. Since 2025, in addition to the United States, more than a dozen major countries such as the United Kingdom, Australia, and South Korea have announced relevant legislative plans. The policy considerations of various countries on stablecoins are no longer a question of whether to develop or not, but a question of how to develop; the regulatory frameworks of various countries for stablecoins are relatively similar, but the difference is that the degree of attention paid to preventing risks and supporting innovation varies.
Under such market development and policy trends, it is recommended that relevant Chinese departments re-evaluate and design their own development policies. This first requires an in-depth and objective analysis of the business model, functional positioning, and stability attributes of stablecoins, the relationship between stablecoins and central bank digital currencies, and the impact of stablecoins on monetary sovereignty, currency internationalization, and illegal financial activities, so as to comprehensively and objectively grasp the functional performance and potential risks, current needs, and long-term value of stablecoins. On this basis, the development plan and policy framework for the introduction of RMB stablecoins should be designed in light of China's national conditions.
As the starting point of development, the offshore RMB stablecoin should be launched in Hong Kong as soon as possible on a trial basis. Hong Kong is an offshore RMB trading center. In recent years, the amount of offshore RMB has continued to grow. There is a good market foundation for issuing offshore RMB stablecoins in Hong Kong. At the same time, Hong Kong has issued the "Stablecoin Ordinance" and established a relatively complete regulatory framework for stablecoins and crypto assets, providing institutional guarantees for the issuance and trading of offshore RMB stablecoins.
At present, Hong Kong has taken the development of stablecoins and crypto asset services as an important means to boost Hong Kong's status as an international financial center. However, Hong Kong implements a linked exchange rate system anchored to the US dollar. The Hong Kong dollar is already a traditional US dollar stablecoin. The market demand for the Hong Kong dollar stablecoin is relatively limited. Hong Kong also needs RMB stablecoins as support to build an international cryptocurrency trading center. After accumulating experience and improving the regulatory mechanism in Hong Kong, we can follow the gradual model of "first offshore and then offshore", promote the development of offshore RMB stablecoins from Hong Kong to the free trade zones and free trade ports in the Mainland, and provide a new engine for the internationalization of RMB.
(Author Shen Jianguang is the chief economist of JD Group, Zhu Taihui is the senior research director of JD Group, and Wang Ruohan is a researcher of JD Group; editors: Zhang Wei and Yuan Man)
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