According to a senior official, the Chinese central bank is “quite worried” about the global financial risks associated with cryptocurrencies. Fan Yifei, a deputy governor of the People’s Bank of China, expressed concerns over the reportedly serious threat stablecoins like Tether pose to global financial and settlement systems, CNBC reported Thursday. PBoC is also working on its central bank-backed digital currencies.
The speed of development in private payment systems is “very alarming.”
The PBoC official emphasized that the speed of development in private payment systems is “very alarming,” and the central bank is working against monopolies and the “disorderly expansion of capital. “Some commercial organizations’ so-called stablecoins, especially global stablecoins, may bring risks and challenges to the international monetary system and payments and settlement system,” the deputy governor at the People’s Bank of China added. In recent times, the Chinese government has already taken some measures to limit the expansion of global stablecoins in the country.
Digital yuan is designed to provide backup for major retail payment services.
The deputy governor further stressed that the PBoC would apply the same restrictive measures that it took on Alibaba’s Ant Group to other entities in the payment services market. As previously reported, the Chinese state halted Ant’s $37 billion IPO last November, also launching an antitrust probe into Alibaba. Mu Changchun, head of digital currency research at the People’s Bank of China, later said that China’s central bank digital currency is designed to provide backup for major retail payment services like AliPay and WeChat Pay as its key objective. China has taken a tough stance on the cryptocurrency industry, recently renewing its crackdown on crypto mining activity as well as cryptocurrency trading.