China Blocks Alibaba, JD.com Stablecoin Plans in Hong Kong

The Financial Times reported that China’s two technology giants, Alibaba-backed Ant Group and JD.com, have been instructed to suspend their stablecoin plans in Hong Kong following explicit guidance from the People’s Bank of China and the Cyberspace Administration of China. This intervention comes just months after both companies signaled strong interest in Hong Kong’s new stablecoin framework in June. Ant Group, whose payment arm previously partnered with Circle in July to support cross-border settlements using USDC, had planned to apply through its international division, while JD.com was exploring global stablecoin licenses as a means to reduce operational costs.

The timing of Beijing’s directive highlights the tension between corporate innovation and state control. Both companies had been positioning themselves to capitalize on Hong Kong’s evolving digital asset landscape, even as mainland officials continued to warn about persistent stablecoin scams. The People’s Bank of China reportedly told both firms not to proceed, emphasizing that private stablecoins could blur the critical line between financial technology and sovereign monetary policy, creating potential conflicts with China’s central bank digital currency, the e-CNY.

According to Joshua Chu, lawyer, lecturer, and co-chair of the Hong Kong Web3 Association, Beijing’s move represents a natural refinement of China’s crypto strategy rather than a sudden policy shift. “There appears to be a tendency to push a narrative that Hong Kong could serve as a loophole for mainland firms to circumvent PRC crypto restrictions, especially around stablecoins,” Chu told Decrypt. “This was never Beijing’s intention,” he emphasized, noting how China’s approach “views speculative retail participation within the mainland as off-limits.”

Chu explained that what’s happening “is a natural refinement emphasizing responsible innovation and compliance rather than speculative hype.” He stressed that “Hong Kong’s reputation depends on maintaining a clean, sophisticated framework that supports genuine market growth without undermining Beijing’s policies.” The intervention signals a clear recalibration of Hong Kong’s role in digital assets, aligning it with Beijing’s regulatory priorities where innovation is tolerated only within clearly defined state and policy boundaries.

Beijing’s intention for Hong Kong’s stablecoin regime is “designed to absorb foreign crypto capital, not serve as a conduit for domestic mainland transactions,” Chu clarified. This distinction addresses what he described as a misconception around private entities that neglects China’s 2021 pronouncement regarding risks in speculative virtual currency transactions, which remain in effect. The move reflects continued caution toward privately managed blockchain projects amid broader reviews of cross-border financial activity.

Officials from the People’s Bank of China cited specific risks to capital supervision and potential overlap with China’s central bank digital currency, the e-CNY, which remains the cornerstone of Beijing’s long-term payments strategy. The concern that private stablecoins could undermine sovereign monetary policy reflects Beijing’s determination to maintain control over the nation’s financial system. This intervention follows a pattern of regulatory actions, including recent instructions to several mainland-linked brokerages to pause real-world asset tokenization efforts in Hong Kong.

An earlier analysis from Decrypt explored how China’s early stablecoin studies pointed to a tiered but fragmented strategy, where state-backed banks, licensed payment firms, and private fintech companies were each exploring separate digital-currency models instead of a unified framework. The current intervention suggests Beijing is moving to consolidate these competing priorities within the system, ensuring that the e-CNY maintains its primacy in China’s digital currency ecosystem.

The blocking of Ant Group and JD.com’s stablecoin ambitions represents more than just a regulatory decision—it signals Beijing’s broader strategy for Hong Kong’s financial future. Rather than expanding on retail speculation, the focus is shifting toward disciplined, cross-border compliance where financial innovation must operate within clearly defined state parameters. This approach ensures that Hong Kong’s development as a digital asset hub complements rather than challenges Beijing’s monetary policy objectives and financial stability concerns.