Quick Takeaways
- Alibaba is exploring a bank-backed deposit token for cross-border payments.
- Beijing has pushed major firms to abandon stablecoin plans in Hong Kong.
- Offshore yuan stablecoins continue, but none target the mainland market.
Alibaba Explores Deposit Token as China Tightens Stablecoin Crackdown
Alibaba Eyes Blockchain Payments
Alibaba’s global e-commerce division is developing a bank-backed deposit token to streamline international transactions. The move comes as China intensifies its crackdown on traditional stablecoins, according to a new CNBC report.
Alibaba president Kuo Zhang said the company wants to use stablecoin-like technology to improve the efficiency of overseas payments. The proposed deposit token would represent a direct claim on bank deposits, making it a regulated and fully backed instrument.
Deposit Tokens Gain Momentum
Deposit tokens closely resemble stablecoins but operate under stricter banking oversight. They are issued by commercial banks and counted as regulated liabilities.
The news follows JPMorgan Chase’s recent rollout of its own deposit token for institutional clients. China’s major tech firms appear to be exploring similar models, though under heavy scrutiny from regulators.
Reports earlier this year claimed that Ant Group and JD.com halted their Hong Kong stablecoin plans after Beijing signaled dissatisfaction. These actions reinforced China’s stance against the rise of a domestic stablecoin industry.
Beijing Blocks Stablecoin Ambitions
Throughout 2024 and 2025, Chinese regulators repeatedly warned firms against developing or advertising stablecoins. Authorities reportedly call for companies to withdraw from crypto-related activities, admit to research and seminars.
Major asylums like HSBC and ICBC had exhibited interest in participating in Hong Kong’s pilot stablecoin political platform. Still, escalating pressure from Beijing has discouraged mainland-linked firms from pursuing such projects.
China’s strict posture stems from concern that stablecoins could enable fraud, cap flight, and unregulated financial activity.
Offshore Yuan Stablecoins Continue
Despite the mainland restrictions, offshore stablecoin development has continued. Conflux launched an offshore yuan-backed stablecoin for use in Belt and Road markets.
In September, a regulated stablecoin tied to the international version of the yuan debuted at the Belt and Road Summit in Hong Kong. Both products target foreign markets rather than mainland Chinese users. Analysts believe Beijing will not allow stablecoins to circulate domestically. As Joshua Chu of the Hong Kong Web Association noted, “China is unlikely to issue stablecoins onshore.”