As the US debates limits on stablecoin rewards, changes in China’s digital currency strategy are reviving concerns over global competitiveness.
A senior policy executive at a US based crypto company warned that restricting stablecoin rewards under the newly enacted legal framework could create a long term strategic disadvantage for the country. According to this view, tighter rules risk weakening the global position of dollar backed digital assets.
The executive noted that competition in digital money is evolving rapidly and that China’s recent steps have made the issue more urgent. Emphasizing that tokenization represents the future of finance, the official cautioned that policy missteps could allow non US alternatives to gain ground.
These comments come as China prepares a major shift in its digital yuan strategy. The country’s central bank announced that starting January 1, 2026, commercial banks will be allowed to pay interest on digital yuan balances. Deputy Governor Lu Lei said the move would transform the digital yuan from a cash like instrument into something closer to a digital deposit.
The US regulation passed in July bans dollar payment stablecoins from offering direct yield. While crypto industry groups argue the restriction should be loosened, banking lobbies are calling for strict enforcement. Industry representatives have told Congress there is no clear evidence that stablecoin rewards threaten banks, highlighting the growing divide between the two sides.
