Nikolas Sargeant
Financial technology company AnchorX has launched AxCNH, the first regulated stablecoin pegged to the offshore Chinese yuan (CNH), marking a significant milestone in Asia's digital currency expansion. The token debuted Wednesday at the Belt and Road Summit in Hong Kong, following China's recent regulatory shift toward embracing stablecoins for international markets. This development represents a strategic move to digitize Chinese currency for global trade, particularly with Belt and Road Initiative partner countries across the Middle East, Europe, and other regions.
Simultaneously, South Korean digital asset infrastructure company BDACS announced the launch of KRW1, a Korean won-pegged stablecoin, on Thursday. Both tokens are overcollateralized, meaning they maintain full 1:1 backing through fiat currency deposits or government debt instruments held by custodians. This dual launch signals accelerating competition among Asian nations to establish their currencies on blockchain networks for enhanced international accessibility and trade facilitation.
The emergence of these Asian stablecoins reflects the growing geo-strategic importance of digital currencies in global finance. Sovereign governments are increasingly placing their fiat currencies on blockchain rails to boost international demand and potentially offset inflationary pressures from currency printing. By operating 24/7 with near-instant cross-border settlement capabilities, blockchain-based currencies offer significant advantages over traditional financial systems that often feature slower processing times and geographic limitations.
The launch of AxCNH represents the culmination of months of policy discussions within China's government. Just one month ago, Beijing was reportedly considering authorizing yuan-backed stablecoins for the first time in what would mark a dramatic policy reversal from its strict anti-cryptocurrency stance established in 2021. The yuan's declining global market share, which fell to 2.88% in June 2025 according to SWIFT data while the U.S. dollar maintained 47.19% dominance, has prompted Chinese officials to view stablecoins as a strategic tool for reducing reliance on dollar-dominated financial systems and enhancing cross-border payment capabilities.
This trend mirrors broader global developments, with major stablecoin issuers like Tether becoming among the world's largest US Treasury holders, surpassing several developed nations. The strategy of backing digital tokens with government debt instruments creates indirect pathways for global retail investors to participate in bond markets, potentially reducing government debt-service burdens while expanding currency accessibility worldwide. As more nations adopt this approach, the international monetary landscape continues evolving toward increased digitization and competition.
