China’s Stablecoin Crackdown and the Global Fight Over Digital Money

China has taken direct aim at stablecoins in a sweeping move that impacts global markets. Thirteen agencies under the PBOC classified stablecoins as illegal financial activities. Markets in Hong Kong reacted immediately with double digit declines in firms tied to stablecoin activity.
This episode examines how China is applying regulatory force to eliminate alternative monetary rails that threaten the digital yuan. We look at the Sovereign Stack implications across governance, identity, value, and compute layers.
We explain why stablecoins processed more than twenty seven trillion dollars last year and why that volume represents a real challenge to Beijing’s capital control regime. We explore the global regulatory convergence driven by the United States GENIUS Act, MiCA, FCA rules, and Asian regulatory frameworks.
Stablecoins are no longer niche crypto instruments. They are global payment rails that extend dollar influence and enable financial exit ability.
And that is exactly why China wants them gone.