AnchorX, a financial technology company, launched AxCNH, the first regulated stablecoin pegged to the international Chinese yuan (CNH), on Wednesday at the Belt and Road Summit in Hong Kong. This was followed on Thursday by BDACS's launch of KRW1, a South Korean won-backed stablecoin. Both stablecoins are overcollateralized, backed 1:1 by fiat deposits or government debt instruments held with custodians.
The AxCNH stablecoin is specifically designed to facilitate cross-border transactions within China's Belt and Road Initiative (BRI), which connects Asia, the Middle East, and Europe. It aims to address costly and slow traditional banking infrastructure in these trade corridors. Similarly, KRW1 seeks to increase international accessibility of the South Korean won and support Seoul's digital finance ambitions.
These launches represent a strategic move by Asian nations to digitize their currencies for global trade, challenging the U.S. dollar's dominance in international payments. Stablecoins are increasingly viewed as instruments of geo-strategic importance, enabling 24/7 near-instant settlement and potentially boosting demand for sovereign debt. The issuers are likely to channel stablecoin reserves into Chinese and South Korean government bonds, which could lower borrowing costs amid rising fiscal pressures.
The developments occur alongside regulatory progress in other regions, including the U.S.'s GENIUS Act and the EU's MiCA framework, signaling a broader acceleration in the global stablecoin race.