TronWeekly

Crypto World News

You are here: Home / Archives for Tether (USDT)

Tether (USDT)

Tether Acquires 32% Stake in Elemental Altus to Bolster Gold-Backed Asset Strategy

by

  • Tether’s $89.2M investment gives it a 31.9% stake in Elemental Altus Royalties.
  • Tether aims to strengthen gold-backed assets and diversify its stablecoin reserves.
  • The deal allows Tether to expand real-world asset support for its digital token ecosystem.

Tether, the company behind the largest stablecoin in the world by market capitalization, has purchased 31.9% of Elemental Altus Royalties Corp., a Canadian gold-centred royalty firm.

This investment is worth approximately $89.2 million strengthening Tether’s long-term strategy of ensuring its digital asset ecosystem is anchored to real-world, stable assets like gold and bitcoin. The investment is also in line with Tether’s increasing interest in extending its financial infrastructure through hard asset-backed products.

Tether Acquires Substantial Stake in Elemental Altus Royalties

On June 10, 2025, Tether Investments, an affiliate of Tether Group acquired 78,421,780 common shares of Elemental Altus Royalties at a price of 1.55 CAD ($1.14) per share. The transaction completed offshore in a private agreement with La Mancha Investments represents nearly one-third of Elemental’s total outstanding shares.

With this purchase, Tether’s holding in Elemental now rises to 33.7% when accounting for previously held shares. Elemental Altus Royalties CEO Frederick Bell welcomed Tether as a major shareholder, citing its capacity to support the company’s next phase of growth.

The purchase is part of Tether’s goal to incorporate stable assets such as gold and bitcoin into its holdings, not just as a hedge, but as a method to reinforce decentralized finance. With the royalty and streaming method of gold exposure Tether is exposed to gold production without directly avoiding the risks of mining. This method also enhances the transparency and stability of Tether’s digital products.

Strategic Option for Further Expansion and Future Gold-Backed Offerings

In addition to the share acquisition, Tether Investments entered an option agreement with AlphaStream Limited and Alpha 1 SPV Limited, its subsidiary company. Under this arrangement, Tether has the option to purchase up to an extra 34,444,580 Elemental shares representing approximately $38.7 million, under some terms and within specific timelines.

If exercised after October 29, 2025, and with the approval of Elemental, Tether’s ownership of the company could increase to 47.7 %. Paolo Ardoino, the CEO of Tether, stressed that the company believes in financial systems secured by tangible assets and cited gold as a “time-tested store of value.” In contrast, Bitcoin is a decentralized hedge against monetary inflation.

Furthermore, the company has a gold-backed stablecoin, Tether Gold (XAUT), which has accumulated a market cap of $854 million, reflecting the increase in the spot gold price over the last year. The new stake in Elemental strengthens the backing for XAUT and signals further commodity-backed digital asset plans.

Building a Resilient, Asset-Backed Financial Ecosystem

The recent investment in Elemental Altus Royalties is an addition to the strategy Tether has been following to acquire long-term assets and facilitate the integrity of its ecosystem. Tether Investments has also diversified its holdings beyond the sectors like artificial intelligence, remittances, and digital infrastructure, in addition to over 100,000 bitcoins and nearly 80 tons of physical gold. 

The Elemental collaboration, which will operate within the Canadian securities regulations, sets Tether to collaborate on governance and long-term strategy, pending regulatory approvals.

Tether Becomes Daily Currency as Bolivia Turns to Digital Dollars

by

  • Tether (USDT) is now widely used in Bolivia, with many stores pricing goods in the stablecoin instead of the national currency due to rising inflation and economic instability.
  • Bolivia lifted its crypto ban in mid-2024, triggering a surge in digital asset adoption, especially USDT, with trading volumes exceeding $48 million in just a few months.
  • Mobile wallets and QR code payments are enabling daily USDT transactions, helping fill gaps in financial access where traditional banking is limited.

Tether is rapidly transforming everyday commerce in Bolivia, as the US dollar-pegged stablecoin USDT gains unprecedented traction among local consumers and businesses. Across the country, shops are now displaying price tags in USDT instead of the traditional Boliviano, signaling a major shift in how Bolivians engage with money amid rising economic instability.

Tether CEO Paolo Ardoino recently spotlighted this growing trend by sharing images of Bolivian store shelves where products like Cadbury Dairy Milk, Milka chocolate, and sunglasses are tagged with prices in USDT. Ardoino praised Bolivia’s rising adoption of the stablecoin, calling it a milestone that reflects how digital currencies are becoming embedded in daily life.

“This is no longer just about trading. It’s about financial survival and modern commerce,” Ardoino remarked. The use of USDT in regular retail transactions highlights a powerful trend in emerging markets: when local currencies falter, digital dollars step in to fill the void.

Bolivia’s stablecoin boom is being fueled by ongoing economic challenges, including inflation and a decline in confidence in the national currency. According to the Central Bank of Bolivia, some goods are now being sold exclusively in USDT. For many consumers, stablecoins like Tether offer a safer, more reliable way to preserve value and conduct everyday transactions.

USDT Transforms Finance in Bolivia After Crypto Ban

The rise of USDT in Bolivia is especially notable given the country’s history with cryptocurrency. For nearly a decade, digital currencies were banned, with authorities labeling crypto as dangerous and even arresting advocates in 2017. But in mid-2024, the Banco Central de Bolivia lifted the ban, officially allowing financial institutions to transact with digital assets. That decision opened the door to a flood of crypto activity, with trading volumes doubling between July and September 2024. During that period, over $48.6 million in virtual assets changed hands, much of it in stablecoins like USDT.

The shift is not just happening online. On the ground, digital wallets and QR code payments are becoming part of daily life. In a country where, as of 2016, only 11% of people used debit cards and 5% used credit cards, mobile-based USDT payments are filling a crucial gap in financial inclusion. Shoppers now use their phones to scan QR codes and pay in USDT, sidestepping the need for cash or bank cards.

This new financial infrastructure got a major boost in October 2024 when Banco Bisa, one of Bolivia’s leading banks, introduced a stablecoin custody service. Supported by the country’s financial regulator, the service allows residents to buy, store, and trade USDT in a secure, regulated environment. It’s a move that has further normalized stablecoin use and built confidence in digital assets.

Tether Gains Ground in Bolivia Amid Currency Instability

With Tether now firmly embedded in everyday commerce, experts say Bolivia could serve as a model for other developing nations grappling with currency instability. The potential benefits are significant, from streamlining cross-border payments to protecting consumers from inflation.

However, the transition also brings challenges. Clear regulatory frameworks are now essential to guide the industry, manage tax implications, and prevent abuse. The Central Bank has already proposed allowing citizens to convert Bolivianos directly into USDT, a step that could reduce exchange rate friction and further accelerate adoption.

Bolivia’s transformation is showing the world how stablecoins like Tether can offer a lifeline in uncertain economic times. What began as a tool for traders is now evolving into a critical part of daily financial life in Latin America, proving that when fiat currencies falter, digital dollars can step in to stabilize and empower.

Related | Bitcoin Price Analysis: Bitcoin’s Final Surge Still Ahead as Top Signal Remains Inactive

Tether Invests in Chile’s Orionx to Boost Stablecoin Use Across Latin America

by

  • Tether leads Orionx’s Series A to boost crypto payments in Latin America’s underbanked markets.
  • Latin America handled $415 billion in crypto from July 2023 to June 2024, per Chainalysis.
  • Orionx now offers stablecoin services to help with payments and treasury management in LATAM.

Tether has announced a strategic investment in Orionx, a Chilean cryptocurrency exchange that operates in Peru, Colombia, and Mexico. This investment finalizes Orionx’s Series A funding round, which Tether led, as both companies seek to broaden digital finance services throughout Latin America.

Orionx offers cryptocurrency solutions primarily directed towards B2B and retail sectors, incorporating cross-border payment systems and treasury services. The company intends to upgrade its infrastructure, develop tools utilizing stablecoins, and broaden its outreach to underserved communities within the region through the acquisition of new capital. 

According to Chainalysis data, Latin America saw approximately $415 billion in crypto transactions between July 2023 and June 2024, showing a growing demand for digital assets in the area.

Paolo Ardoino, Tether’s CEO, emphasized the strategic nature of the investment, stating that the deal would “advance our broader vision of making stablecoin-powered financial tools accessible” across underbanked areas. The initiative follows Tether’s earlier support of Orionx via Bitfinex, its sister company, in 2023.

Focus on Financial Inclusion Through Crypto Infrastructure

Tether’s investment supports ongoing initiatives to address financial exclusion in Latin America. This region still has one of the highest proportions of unbanked adults globally, as numerous individuals face geographic, regulatory, and cost obstacles that limit their access to conventional financial systems.

In this context, stablecoins present a viable option by facilitating low-cost and secure transactions independent of traditional banking systems. Orionx enables local businesses and institutions to process payments with dollar-pegged digital assets, thus simplifying operations for those usually not part of the banking ecosystem.

Orionx CEO Joel Vainstein described the collaboration as a key shift for the company’s B2B strategy. “We see exponential growth in the number of companies seeking faster and more cost-efficient solutions for payment collection, distribution, and treasury management,” he stated. The partnership with Tether, he added, will accelerate Orionx’s capacity to meet rising demand.

Stablecoins Gain Traction Amid Economic Instability

Latin America’s increasing fascination with cryptocurrency is largely influenced by regional macroeconomic instability. In nations such as Argentina and Brazil, notable currency devaluations have led both businesses and individuals to turn to stablecoins as a protection against inflation.

Furthermore, Chainalysis data indicates that stablecoins accounted for most of the indirect cryptocurrency flows to global exchanges in the region over the last year. This demand illustrates a larger trend towards digital dollar-denominated assets, especially in regions with regulatory frameworks that support institutional adoption.

Orionx’s infrastructure allows users to easily access fiat onboarding and offboarding, rapid remittance services, and smooth onboarding processes. With Tether’s support, these features will be significantly enhanced, establishing stablecoins as a key component of LATAM’s digital financial landscape.

Related Reading |  SUI Price Is Under Pressure Close To The Major Selloff Zone At $3.06 

Tether Mints Massive $16B USDT on Tron in 2025, Total Supply Now Exceeds Ethereum

by

  • Tether minted 16 billion USDT on Tron in 2025, bringing its total USDT supply on the network to 75.7 billion, higher than that of Ethereum.
  • Recently, there has been a high rise in institutional and trader interest in stablecoins, and with more users moving to Tron, it shows that there are changes in trading behavior and blockchain adoption.

Tether has made another bold move with its recent $16 billion USDT mint on Tron. Due to this move, the platform’s USDT supply on Tron has increased to 75.7 billion, surpassing the amount issued on Ethereum. 

The data was shared by popular on-chain analysis platform, Lookonchain. According to Lookonchain, Tether minted 16 billion USDT on Tron thereby increasing the total amount of USDT on the Tron network to 75.7 billion. With this increase, Tron now holds more USDT than Ethereum, showing that more users prefer Tron to Ethereum. 

Screenshot 20250517 103405 X
Tether Mints Massive $16B USDT on Tron in 2025, Total Supply Now Exceeds Ethereum 2



This growth shows that many traders are choosing Tron for stablecoin activity. Tron’s low costs and faster speed make it attractive for sending and receiving digital dollars. The added supply may improve overall crypto liquidity, affect how much trading happens on top exchanges, and create new price differences across chains that arbitrage traders can use.



Institutional Interest in Tether’s and TRON’s overall growth


Tether’s new mint goes a long way to show how much interest from market players and institutions using stablecoins has increased over time; and with TRON’s USDT growth, it gies on to show how much users have moved from Ethereum. With the platform’s lower fees and easy confirmation, Tron is users’ first go-to platform for all stablecoin-related trading activities.

From a trading perspective, the minting of 16 billion USDT on Tron could mean different opportunities and risks for crypto traders. The immediate implication is a potential increase in liquidity for Tron-based decentralized finance (DeFi) protocols and trading pairs like TRX/USDT, while the liquidity could also fuel speculative trading in Tron ecosystem tokens.

As the stablecoin market evolves, this development signals deeper changes in trading behavior, network usage, and liquidity distribution across the crypto ecosystem.

More Reading: Dogecoin Faces Short-Term Dip Risk to $0.20 Amid Bullish $1 Breakout Outlook

Tether’s Q1 Report Shows Over $1 B Profit and Near-Record $120B in U.S. Treasuries

by

  • Tether posted over $1B in Q1 2025 profit, supported by strong U.S. Treasury yield returns.
  • USD₮ supply rose by $7B as user wallets increased by 46M in Q1, showing rising adoption.
  • U.S. Treasury assets reached $120B for Tether, making up most of its backing reserves.

Tether International has released a Q1 2025 attestation report confirming financial success despite challenging crypto market conditions. The stablecoin issuer generated over $1 billion in operating profit, reaching its maximum ever U.S. Treasury holdings, which are near an all-time high of $120 billion. The figures, verified by accounting firm BDO, reflect a growing reliance on government securities for liquidity and reserve strength.

The latest performance indicates a more conservative income stream from Treasury yields than the $4.52 billion profit in Q1 2024, which was driven largely by Bitcoin and gold gains. As of March 31, the firm held assets worth $149.3 billion and liabilities worth $143.7 billion. The company maintains an excess reserve of approximately $5.6 billion, highlighting its interest in risk management through cash-equivalent assets.

Stablecoin Circulation and User Growth Expand

USD₮ circulation grew by about $7 billion in Q1 2025, bringing the total supply to nearly $148 billion. During the quarter, the user base adopting stablecoin wallets increased to 46 million, leading to a 13% rise. USD₮ has gained global adoption because of its position as a digital dollar alternative in various economic systems.

Tether attributes its growth to its stablecoin’s liquidity and operational attributes, including liquidity, transparency, and easy accessibility to digital assets. Moreover, 66% of the reserves backing USD₮ are in U.S. Treasuries, with a smaller portion in gold and Bitcoin. The reserves held by Tether in Bitcoin declined to $7.7 billion, down from prior quarters, due to new U.S. regulatory frameworks for stablecoin issuers.

Tether’s Regulatory Advances and Strategic Investments

Q1 2025 marked Tether’s first reporting period under regulatory oversight in El Salvador. According to El Salvador’s digital asset framework, the company operates as a licensed stablecoin issuer. The regulatory acknowledgment signifies positive movement in stablecoin legislation throughout the U.S., with the company distributing most of its reserves to government bonds to prepare for future compliance.

Tether makes investments outside its reserve holdings through its subsidiary, Tether Investments. The company has allocated over $2 billion to projects focusing on artificial intelligence, renewable energy, communications, and data infrastructure. The strategic investments made by Tether are not part of USD₮’s reserve backing, although they demonstrate the company’s commitment to emerging technological developments.

CEO Paolo Ardoino said, “We remain focused on delivering trust, transparency, and value to hundreds of millions of users.” While strengthening the US dollar’s digital presence, Tether is building its position within the worldwide digital finance industry through increased Treasury backing and an expanding user base.

Tether Surges Toward $1.5B Revenue Milestone as Ethereum Lags Below $200M

by

  • Tether has earned up to $1.46 billion so far and is getting close to surpassing $1.5 billion soon.
  • In 2024, the company’s total equity exceeded $20 billion due to the rising adoption of USDT, strong transaction volumes, and other smart investments.

Tether’s earnings have significantly grown along with the rising value of its stablecoin. The total amount of USDT that is currently in use has risen to more than $144 billion, compared to the $109 billion it was this time last year.

Tether (USDT) has earned about $1.46 billion so far in 2025, according to TokenTerminal, and is expected to pass the $1.5 billion mark soon. This shows strong growth compared to its competitors in the crypto space.

According to the data, the platform’s income is much higher than other blockchain platforms like Tron, Circle, Solana, and Ethereum. Ethereum, which was once part of the top earners, has only brought in $157 million this year. Circle, the company behind USDC, made $620 million as it plans to go public, while Solana has earned $159 million, helped by the rise of meme tokens. Tron is the closest to reaching $1 billion.

The rise in Tether’s income could be linked to its wide use on global exchanges and the growing demand in developing countries. In contrast, Ethereum is losing revenue as more activity shifts to cheaper layer-2 networks, even though it still leads in smart contract apps.

Tether’s Continuous Growth and Strategic Expansion

In 2024, the last quarter ended with the platform’s yearly profit topping $13 billion. The company’s total equity also rose above $20 billion, thanks to the smart moves taken in different areas like clean energy, crypto mining, artificial intelligence, mobile networks, and learning.

Tether has kept growing in 2025 as more users see and turn to stablecoins for more safety and ease of use. Visa data shows that in April alone, Tether’s volume reached $266 billion, with total transactions for the year already above $1.5 trillion.

Screenshot 20250420 172000 Chrome
Tether Surges Toward $1.5B Revenue Milestone as Ethereum Lags Below $200M 4

Russia Eyes Stablecoin Solution to Reduce US Dollar Dependency Amid Sanctions

by

  • The Russian Finance Ministry proposes a stablecoin to mitigate financial sanctions and trade hurdles.
  • Tether’s wallet freeze highlights Russia’s need for domestic stablecoin alternatives.

A senior Russian official has pushed for the development of a stablecoin backed by Russian rubles after Tether froze crypto assets belonging to Russian users. In March 2025, Tether froze wallets connected to Garantex, a Russian crypto exchange, and froze USDT worth more than $30 million. 

The wallet freezes pushed Russian officials to examine why their country depends on foreign stablecoins, including USDT and USDC, which are linked to US dollar values. According to Osman Kabaloev, deputy head of the Finance Ministry’s financial policy department, Russia should create its own to minimize dependence on foreign regulatory authorities and external sanctions.

Russia’s Push to Create Digital Alternatives

Tether’s freeze of assets highlights the growing pressures Russia faces due to Western financial sanctions. In response to these challenges, Russian officials are considering creating digital currencies pegged to the ruble or other foreign currencies. 

This move aligns with Russia’s broader objective to move away from reliance on dollar-backed stablecoins and support international trade without the interference of US-based financial institutions. Russia’s exploration of a ruble-pegged stablecoin is not entirely new. 

In 2023, the Russian central bank discussed the possibility of collaborating with Iran to create a gold-backed digital currency for cross-border transactions. While developing a ruble-backed stablecoin would serve a similar purpose, it would also address immediate concerns about freezing crypto assets by third parties like Tether.

Impact on Russian Businesses and Crypto Adoption

The crypto wallet freezing prompted numerous Russian businesses to reassess their usage of USDT for cross-border payments. The growing economic restrictions on Russian companies have prompted the search for alternative payment methods, including stablecoins, as necessary tools to sustain international trade. 

Russian authorities permit select companies to evaluate crypto-based payment systems for international transactions despite their objections to their use for domestic deals. This restricted study evaluates digital payment alternatives as a way to bypass financial restrictions imposed by Western nations.

Despite these efforts, the Tether incident revealed the risks of using stablecoins whose backing comes from abroad. The Russian government is working to protect its financial network by creating a digital currency managed by the state that operates free from international interference. This plan will likely succeed as Russia faces mounting financial constraints from the Western nations.

Tether’s Sudden U-Turn: Political Connections Behind US Move?

by

  • Tether CEO Ardoino seeks active US role, aiming to influence stablecoin bills in Congress, citing competitor size.
  • The stablecoin issuer plans a new US-compliant stablecoin alongside USDT, pursuing a full audit for transparency.
  • Amid scrutiny and political ties, Tether’s US engagement marks a strategic shift to counter critics and leverage a favorable environment.

Tether is ready for its US chapter, as CEO Paolo Ardoino is reportedly in talks with American lawmakers and regulators for a more active role. As per a Forbes report, Ardoino and his firm want to be key influencers in the ongoing dialogue of the future of digital assets, especially as two rival stablecoin bills are moving forward in both chambers of Congress.

“I think it’s important that our voice gets heard in the stablecoin bill process. Our competitors are very tiny. They don’t represent the actual use cases of stablecoins,” says Ardoino.

Not only that, the issuer of the $144 billion USDT stablecoin is even exploring plans to launch a new stablecoin in the United States. Ardoino claims that it enjoys a first-mover advantage that allowed it to capture a large market share, especially in emerging markets.

Tether
Tether's Sudden U-Turn: Political Connections Behind US Move? 6

With regards to the new stablecoin, Ardoino clarified it wouldn’t replace USDT but would be a parallel product in compliance with the American laws. To ensure complete transparency, Tether would initiate a full financial audit and is currently in discussions with one of the Big Four accounting firms.

As Tether embarks on this bold expansion, Ardoino claimed that it is a strategic move to flip the narrative that the firm is evading U.S. oversight. “Some of our competitors have tried to push regulations towards killing USDT Their entire strategy was, ‘Tether will never be in the US. It is afraid to come to the US.’ Well, here we are.“

Unpacking Tether’s Changing Strategy

While launching a new coin serves as a direct response to his critics, the timing of the announcement has raised questions. In particular, USDT has come under increased scrutiny, like Binance delisting USDT from its European platforms due to non-compliance. Tether’s abrupt willingness to engage with American institutions could be just more than a signal of confidence but a strategic shift based on changing political and regulatory dynamics.

This turnaround, along with growing pressure to legitimize operations, may have prompted the leadership to change gears. Another possible factor is the reported 5% stake of recently appointed U.S. Commerce Secretary Howard Lutnick in Cantor Fitzgerald, a firm closely linked to Tether (via partnerships and custodial roles).

With such influential political figures now indirectly tied to the firm, Tether might be leveraging a more favorable environment to enter the market, something it had avoided until now.

USDC Issuer Circle Plans To File IPO In Late April

by

  • Circle collaborates with JPMorgan and Citi for IPO filing in April.
  • SEC blocked Circle’s 2021 SPAC deal; IPO now the traditional route.
  • USDC expands to Japan, marking major growth in global stablecoins.

USDC issuer Circle is preparing to launch its long-anticipated initial public offering (IPO). The company has teamed up with JPMorgan Chase and Citi to implement its public listing procedure. According to reports, Circle intends to file the relevant IPO documents in late April.

Circle’s Second Attempt At IPO 

Circle plans to file IPO documents for the second time after the company cancelled its previous attempt to go public. In 2021 Circle entered into an agreement to merge with a Special Purpose Acquisition Company (SPAC). The US Securities Exchange Commission (SEC) blocked this transaction which led Circle to drop its SPAC plans.

Circle has chosen to proceed with a traditional IPO process because this process has less complications. Although Circle will file documents in late April, an actual public listing process could extend beyond this period. Companies usually start trading four weeks after filing for IPO, but the process can sometimes be delayed.

Stablecoin Regulatory Frameworks

Circle’s initial public offering (IPO) comes after the company formed a partnership with the parent company of the New York Stock Exchange (NYSE). The firm seeks to integrate its USDC stablecoin with traditional finance institutions (TradFi). Japan’s regulator approved USDC which made it the first international stablecoin to be authorized under Japan’s stablecoin framework.

The company anticipates less regulatory challenges as it moves ahead with its plans. The crypto industry experiences more favorable treatment from the current SEC leadership. Acting SEC Chair Mark Uyeda has demonstrated support for the industry unlike his predecessor Gary Gensler.

USDC and Stablecoin Expansion

Circle announced an IPO bid at a time when the stablecoin industry continues to expand. Circle’s USDC ranks as the second biggest stablecoin after Tether’s USDT. Other firms such as Fidelity have joined the race for stablecoin issuance which reflects increased market competition.

Circle’s planned initial public offering represents one of the largest crypto sector IPOs since Coinbase went public in 2021. Circle’s plan comes amid increased interest in stablecoins from traditional financial institutions and regulatory bodies. The company dominates its market which allows it to lead in this industry trend.

Circle’s USDC stablecoin has achieved substantial growth and has become a reliable option for digital asset exchanges. The firm shows strong potential for expansion because of its growing partnerships and diverse user base. The IPO filing enables Circle to establish its dominance across the crypto and traditional finance sectors.

Circle’s IPO path could establish a benchmark for crypto firms that want to become public in future. The solid market position and support from major banks positions the company to advance its future expansion.

China’s Bold Move: Digital Yuan Set to Counter US Dollar Coins

by

  • China aims to expand digital yuan to rival dollar-backed stablecoins.
  • China Expands Digital Yuan’s Reach to Compete with US Dollar Coins
  • China’s Digital Yuan Faces Global Competition from Dollar Stablecoins

China has expressed concerns about the influence of U.S. dollar-backed stablecoins on global financial systems. The Chinese government views U.S. dollar stablecoins as a threat to its financial independence. China has intensified efforts to develop its digital yuan (CNY) to position it as an alternative to U.S. dollar stablecoins in the international trade market.

Digital Yuan to Enhance China’s Financial Position

The stablecoin market has witnessed rapid growth to exceed $200 billion in 2025. Tether (USDT) and USD Coin (USDC) account for 90% of the stablecoin market. There is increased utility of stablecoins in global trade because they provide liquidity as well as link digital assets with fiat currency.

China believes the widespread acceptance and stability of the U.S dollar have enhanced the Dollar-backed stablecoins dominance. These features make dollar-backed stablecoins influential in global markets and attractive to investors. China aims to improve its digital yuan to compete with U.S. stablecoins amid a push for regulatory clarity on stablecoins.

Although China introduced a central bank digital currency (CBDC) early, it restricted the use of digital yuan to retail payments. China must extend the capabilities of its digital currency beyond consumer payments to challenge USD-backed stablecoins. The Chinese government wants to expand digital currency applications to reach M1 (cash and demand deposits) and M2 (cash plus all deposits) levels to expand its utility in domestic and international markets.

China aims to integrate digital yuan with major international platforms and applications such as credit markets. China aims to develop a stable digital currency and expand its applications to gain a competitive advantage in the stablecoin market.

Global Concerns About Dollar-Backed Stablecoins

Other countries have also expressed similar concerns about U.S. dominance in global financial systems. European officials recently expressed concerns about the influence of U.S stablecoins . Pierre Gramegna, managing director at European Stability Mechanism warns that dollar-backed stablecoins could undermine EU’s financial independence.

China seeks to make the digital yuan available across the world to boost the position of Chinese renminbi in global trade. China aims to position its currency as a competitor to the dollar by expanding the use of its digital currency across domestic and international networks. China aims to reduce U.S. dollar stablecoin dominance through proper design and risk management controls.

China aims to establish control over its financial future through the improvement of the digital yuan. China is committed to strengthen the position of its Central Bank Digital Currency in global financial systems amid intense competition in digital currency markets.