China is likely to push the e-CNY as it extends stablecoin restrictions to offshore.
Tightened digital asset regulations could curb even offshore stablecoin business opportunities for China’s financial institutions, said S&P Global Ratings.
Instead, China will likely push its central bank digital currency (CBDC), the e-CNY, instead of stablecoins.
Chinese regulators have tightened rules on cryptocurrency and digital assets, extending stablecoin restrictions to offshore. This includes issuance by Chinese entities, or pegged to the Chinese renminbi, the ratings agency noted in a 13 February 2026 report.
As a result, Chinese financial institutions likely won’t be able to issue stablecoins in Hong Kong, despite the city’s introduction of a new framework in 2025. Hong Kong is set to grant its first batch of licenses to stablecoin issuers in March 2026.
Hong Kong’s stablecoins regime is also affected by China’s restrictions.
“We also expect Beijing’s tightening to reduce Hong Kong stablecoin’s use cases in some cross-border businesses with the mainland, such as wealth management and payment transactions,” S&P noted.
On the other hand, the tighter management helps in avoiding business or operating risks.
“Mainland Chinese authorities aim to rein in potential financial risk spillover from digital asset activities outside of China,” Michael Huang, credit analyst, S&P Global Ratings.
In China, the e-CNY is likely to be regulators’ main push. Regulators recently made changes on the e-CNY to allow it to earn interest.
“They are dispersed and operate via commercial banks’ digital wallets and serve as an additional source of funding banks can utilize, enabling them to also promote incremental business opportunities,” S&P wrote.