China tells brokers to stop endorsing stablecoins in bid to avoid instability, Bloomberg News reports
Some brokerages and think tanks received guidance from market regulators in late July and earlier this month, pushing them to cancel seminars and discontinue dissemination of research on stablecoins, the report said, citing people familiar with the matter.
Regulators are also concerned that stablecoins could be exploited as a new tool for fraudulent activities in mainland China, the Bloomberg report said.
China Securities Regulatory Commission and the People's Bank of China did not immediately respond to a Reuters request for comment. Reuters could not immediately verify the report.
Stablecoins are a type of cryptocurrency designed to maintain a constant value and are usually pegged to a fiat currency such as the U.S. dollar and are commonly used by crypto traders to move funds between tokens.
While China's 2021 ban on cryptocurrency remains in effect on the mainland, Hong Kong passed a stablecoin bill earlier this year to boost its status as a global digital asset hub.
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