Circle’s CEO Jeremy Allaire argues that a stablecoin pegged to the Chinese Yuan But a yuan stablecoin isn’t going to happen, just like a Chinese CBDC isn’t going to challenge the dollar.
Why? Because the free convertibility of the yuan goes against a core fundamental of Beijing’s monetary policy.over the exchange rate of the yuan, keeping it within a narrow band and not allowing it to float freely in international markets. This allows China to maintain control over its export prices and its domestic economy.
As the IMF’s First Deputy Managing Director Gita Gopinath pointed out in a 2022 address, these aren’t the traits of a global currency. After all, the yuan is"If a country is aspiring to be a global currency, then in that case, you would need to have, you know, basically fully and freely mobile capital, full capital account liberalization, full convertibility of exchange rate, which is not the case right now in China," Gopinath isCurrency manipulation has been a contentious issue in U.
For its part, Taipei denies that it's an active currency manipulator or has capital controls pointing to the openness of foreign investment in its equities market and theBut if there’s one thing that unites Taipei and Beijing, its that central bankers in neither capital want to relinquish control of their currencies to the market.