On June 15th, Xiao Feng, Vice Chairman of Wanxiang Holdings, delivered a keynote at the China Wealth Management 50 Forum (CWM50) seminar "Rapid Development of Stablecoins: Potential and Challenges." He framed stablecoins as evolutionary "tokenized money"—a blockchain-native financial instrument reshaping global payment infrastructures.
I. The Paradigm Shift of Tokenized Money
(A) Distributed Ledger Technology as the Foundation
Stablecoins emerge from three computational accounting revolutions:
- Single-entry bookkeeping (ancient Mesopotamia)
- Double-entry bookkeeping (14th century Italy)
- Distributed ledger accounting (post-2009 Bitcoin blockchain)
Unlike private reconciliations in traditional finance, blockchain's shared ledger enables peer-to-peer transactions without intermediary alignment. This spawned two trends:
- Digital natives (e.g., Bitcoin)
- Digital twins (e.g., USDT tokenizing USD)
(B) Next-Gen Financial Market Infrastructure
Key innovations include:
| Traditional System | Blockchain System |
|---|---|
| Centralized clearing | Point-to-point execution |
| Net settlement | Real-time gross settlement |
| Limited operating hours | 24/7/365 availability |
👉 Explore how blockchain transforms finance
II. Real-World Asset Tokenization (RWA)
(A) Evolutionary Stages
Fiat currency tokenization (2014-present)
- $16-28 trillion annual transaction volume
- Primary users: Africa's unbanked populations
Financial asset tokenization (2023-)
- BlackRock's tokenized treasury funds
Physical asset tokenization (2025 projected growth)
- Challenges in property rights binding
(B) Transformational Benefits
- Global liquidity enhancement
Brazilian investors can bypass traditional custodians to access Hong Kong stocks. - Novel settlement models
DeFi "flash loans" achieve 67x annual capital turnover vs. traditional banks' 7-8x. - Programmability
Smart contracts automate settlements in seconds—bypassing courts/accountants. - AGI-era readiness
Machine-to-machine economies require programmable payment rails.
III. Stablecoins as Monetary Instruments
Core Attributes:
- Cross-jurisdictional fluidity: Operates beyond SWIFT systems
- High-velocity money: 10-second "flash loan" settlements
- Democratized access: Mobile wallets bypass traditional KYC
Cross-Border Impact:
- Chinese e-commerce merchants report 30% faster payments via stablecoins
- African unbanked populations gain USD access through mobile wallets
👉 Discover stablecoin use cases
IV. Geopolitical Implications of Dollar Stablecoins
Strategic Objectives:
Preserve dollar hegemony as digital successor to:
- Gold-standard dollars (1944-1971)
- Petrodollars (1971-present)
- Circumvent SWIFT erosion while capturing 99.99% of $20T stablecoin transactions
Regulatory Landscape:
- US Congress advancing Stablecoin Bill (August 2024 target)
Hong Kong's dual-track approach:
- Onshore HKD stablecoins (retail accessible)
- Offshore variants (wholesale only)
V. China's Strategic Pathways
(A) Policy Recommendations
- Hong Kong pilot program for offshore CNH stablecoins
Integration with:
- Shanghai FTN accounts
- Hainan Free Trade Port policies
(B) CBDC Synergy Model
Two-tier architecture:
- PBOC issues CBDC to licensed issuers
- Issuers mint stablecoins for global circulation
FAQ: Addressing Key Concerns
Q: Are stablecoins creating uncontrolled money supply?
A: No—each token is 1:1 backed by bank-deposited fiat without fractional reserve lending.
Q: How do stablecoins impact monetary sovereignty?
A: They create parallel systems outside national banking networks, requiring proactive regulatory frameworks.
Q: Can China block dollar stablecoin usage?
A: Technically challenging—peer-to-peer flows bypass traditional payment gateways.
Q: What's the timeline for yuan stablecoins?
A: Hong Kong trials could begin 2025, with mainland integration contingent on capital account reforms.
Q: Do stablecoins enable illicit finance?
A: Blockchain analytics tools (e.g., Chainalysis) provide greater transparency than cash transactions.
Q: How will AGI interact with stablecoins?
A: Programmable money enables autonomous machine-to-machine micropayments—a $3T+ future market.