The world’s first regulated offshore yuan-linked stablecoin has launched in Kazakhstan this month as part of China’s blockchain strategy for international commerce. Reportedly, the cryptocurrency, called AxCNH, went live on September 17 through Hong Kong fintech company AnchorX.
Yang Guang, chief technology officer at Shanghai-based Conflux, stated that the low-key launch could create a “butterfly effect” potentially reshaping cross-border payment systems. Conflux, a Chinese government-backed blockchain network, provided the underlying technology for the stablecoin.
As per Reuters, AnchorX obtained a license from Kazakhstan’s financial regulator to issue the yuan-pegged cryptocurrency. Kazakhstan is Central Asia’s largest economy, and maintains China as its biggest trading partner and participates in the Belt and Road Initiative.
China Pushes Yuan Stablecoins Abroad
The stablecoin launch aligns with China’s multi-pronged approach to increase global yuan adoption. Beijing has pursued various strategies including promoting its central bank digital currency alongside exploring blockchain-based payment solutions.
China has long sought global currency status for the yuan, reflecting its position as the world’s second-largest economy. However, strict capital controls and annual trillion-dollar trade surpluses have complicated these ambitions.
“As U.S. dollar stablecoins grow, can you imagine a digital world in 10, 20 years’ time, where there’s no place for the Chinese yuan on blockchains? Of course not,” Yang told Reuters. The computer scientist from Tsinghua University emphasized China’s need to invest in blockchain technology.
Yang indicated that issuing offshore yuan stablecoins does not theoretically require Chinese central bank approval. Beijing would likely support such initiatives if they facilitate cross-border trade operations.
Conflux has received a government mandate to build blockchain infrastructure connecting Belt and Road Initiative countries. This platform aims to streamline payment flows between participating nations.
Related: Conflux (CFX) Jumps 42% as a New Yuan-Backed Stablecoin Is Announced
Yuan-backed Stablecoin Targets Cross-Border Payments
Stablecoins provide low-cost, efficient cross-border payment alternatives while bridging traditional finance and digital assets. The yuan-backed version could challenge dollar dominance in cryptocurrency markets as global trade patterns shift.
Augustine Fan, head of insights at SignalPlus trading platform, described the initiative as “another venue or trial to push the use of the offshore yuan.” The launch suggests regulators maintain positive views toward blockchain technology’s potential applications.
AnchorX, backed by Conflux and Chinese investment firm Hony Capital, positions the stablecoin as a cost-effective payment alternative for transactions between Belt and Road countries and offshore Chinese entities. Hong Kong has established regulatory frameworks for stablecoins but has not yet issued licenses to any issuers.
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