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Shanghai Regulator Considers Policy Responses to Stablecoins and Digital Currencies, Signaling Shift in China’s Crypto Stance

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A regulatory body in Shanghai convened a meeting this week with local government officials to discuss strategic policy responses toward stablecoins and cryptocurrencies, marking a notable shift for China, where crypto trading remains banned. The meeting, held on Thursday by the Shanghai State-owned Assets Supervision and Administration Commission, follows growing calls from experts and major Chinese companies to develop a yuan-pegged stablecoin.

He Qing, director of the Shanghai regulator, emphasized the need for “greater sensitivity to emerging technologies and enhanced research into digital currencies” during the session, according to the regulator’s official WeChat post. The meeting was attended by roughly 60 to 70 participants.

Shanghai, as China’s leading international financial center, often pilots regulatory reforms. Nick Ruck, director at LVRG Research, highlighted Shanghai’s potential to shape blockchain-based payment innovations, given China’s strong fintech ecosystem.

Globally, blockchain-based stablecoins—typically pegged to fiat currencies and enabling faster, cheaper transactions—have gained momentum. ARK Investment Management estimates that stablecoin transaction volumes reached $15.6 trillion worldwide last year, surpassing Visa’s transaction value. The U.S. has seen growing interest from large companies such as Amazon and Walmart in launching stablecoins.

In Asia, South Korea’s government has pledged to allow won-based stablecoins and support related infrastructure, though the central bank advises a cautious, gradual approach. Within China, companies like JD.com and fintech giant Ant Group have urged the People’s Bank of China to approve yuan-based stablecoins to counter the dominance of U.S. dollar-linked cryptocurrencies. Both plan to seek stablecoin licenses in Hong Kong, where legislation takes effect on August 1.

The Shanghai meeting included a policy expert from Guotai Haitong Securities, who provided an overview of cryptocurrencies and stablecoins, examined global regulatory frameworks, and offered policy suggestions for digital currency development.

Meanwhile, Yang Tao, deputy director of the National Institution for Finance and Development, recommended exploring yuan-based stablecoin issuance in both the Shanghai Pilot Free Trade Zone and Hong Kong simultaneously.

Despite this increasing interest, significant hurdles remain. China’s capital controls present major challenges for stablecoin development, and central bank governor Pan Gongsheng recently warned that the rise of digital currencies and stablecoins poses serious regulatory challenges. Cryptocurrency trading and mining were banned in mainland China in 2021 over financial stability concerns.

While stablecoins are gaining attention domestically, the future of other cryptocurrencies in China remains uncertain. Outside the mainland, cryptocurrencies continue to grow in popularity, with Bitcoin recently hitting a record high above $118,000.

Nvidia CEO Jensen Huang to Meet Former President Trump Ahead of China Visit

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Nvidia CEO Jensen Huang is scheduled to meet former U.S. President Donald Trump at the White House on Thursday, a day before Huang’s planned trip to China, according to a source familiar with the matter. The meeting takes place as Nvidia’s market valuation recently surpassed $4 trillion for the first time, underscoring the company’s position as one of Wall Street’s most valuable stocks.

Specific details about the agenda of the discussions have not been disclosed. Bloomberg was the first to report the meeting, while neither Nvidia nor the White House immediately responded to Reuters’ requests for comment.

Huang has previously criticized the export restrictions imposed by the Trump administration in April, which halted Nvidia’s ability to sell its H20 AI chip to China—a product Huang described as a “springboard to global success.” These U.S. export curbs resulted in a $2.5 billion loss in sales for Nvidia in the first quarter, with the company forecasting an $8 billion revenue impact in the second quarter.

Due to these stringent trade restrictions, Huang announced in June that Nvidia would exclude China from its revenue and profit projections going forward.

China’s CXMT Corp Begins IPO Preparation Amid Push to Expand DRAM Chip Business

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CXMT Corporation, the parent company of Chinese DRAM chipmaker ChangXin Memory Technologies, has started the initial preparations for an initial public offering (IPO), according to a document released by China’s securities regulator.

Summary:

  • IPO Preparation:
    CXMT has entered the “counselling process” for an IPO, having hired state-owned investment banks China International Capital Corporation and CSC Financial to assist. However, details on the timing or location of the IPO remain undisclosed.

  • Company Profile:
    CXMT is a major player in China’s drive to develop a domestic dynamic random-access memory (DRAM) chip industry, a sector historically dominated by firms from the U.S., Japan, and South Korea. Founded in 2016 with state backing, CXMT oversees subsidiaries including ChangXin Memory Technologies.

  • Production Facilities:
    The company operates two semiconductor foundries in China—one in Hefei, Anhui Province, and a newer facility in Beijing, with production ramping up since September 2023. Monthly production capacity is estimated at around 200,000 12-inch wafers.

  • Regulatory Challenges:
    CXMT narrowly avoided being added to the U.S. Entity List in May but remains subject to U.S. export restrictions from October 2022, which limit China’s ability to manufacture advanced DRAM chips.

  • No Further Details:
    The document did not specify which assets will be part of the IPO or whether the CXMT subsidiary itself will be listed. The company did not immediately respond to requests for comment.