In a surprise statement that’s sending shockwaves through the crypto world, Pan Gongsheng, Governor of China’s Central Bank, has positioned blockchain as a strategic asset of national interest — and fired a clear warning shot at privately issued stablecoins like USDT and USDC.
While it may have sounded like a routine comment on digital currencies, Pan’s remarks are being interpreted as a strategic shift. Experts believe this signals the beginning of the end for informal stablecoins, which are now facing increased scrutiny and existential risk.
The Three-Pronged Strategy: National Blockchain Offensive
Pan’s message hints at a powerful multi-layered plan:
- Undermining Dollar-Based Settlements:
By advocating for distributed ledger technology (DLT), central banks aim to weaken the dollar’s grip on global cross-border payments. Blockchain-based ledgers allow for synchronized, decentralized transactions — bypassing traditional banking infrastructure. - Targeting Private Stablecoins:
With CBDCs (Central Bank Digital Currencies) being rolled out worldwide, unofficial digital IOUs like USDT — which lack sovereign backing — may soon be rendered obsolete. Their value depends entirely on trust, not on national reserves or regulations. - Expanding the Digital Yuan’s Footprint:
China’s digital renminbi trial now covers 26 regions. In Suzhou, government workers are being paid entirely in e-CNY. Meanwhile, central banks in Thailand and the UAE are already partnering with China to build a cross-border blockchain-based payment network.
A Warning Years in the Making: The USDT Domino
This isn’t a sudden turn of events. In 2023, Tether (issuer of USDT) faced backlash for a $19 billion gap in its reserves. While the company weathered the storm then, the foundations have remained shaky.
Following Pan’s statement, the financial dominoes began to fall:
- BlackRock swiftly applied to launch its IBIT — a stablecoin backed by U.S. government bonds and hosted on a blockchain.
- The U.S. Securities and Exchange Commission announced a crackdown on all algorithmic stablecoins, with sweeping investigations starting July 2025.
The message is unmistakable: as governments enter the arena, they’re coming for private, unregulated players first.
Survival Guide for Retail Investors
If your crypto portfolio leans heavily on informal stablecoins, financial experts are urging immediate action. Here are three ways to adapt:
- Reduce Exposure to Informal Stablecoins:
If more than 90% of your holdings are in USDT, consider shifting at least 50% to alternatives like the offshore Chinese e-CNY, now available for deposit in Macau. - Embrace Regulated Stablecoin Alternatives:
BlackRock’s upcoming IBIT stablecoin promises 5% annualized returns backed by government bonds — with zero transaction fees. That’s a sharp contrast to USDT’s hidden costs and risks. - Get Ahead in the CBDC Ecosystem:
Chinese giants like Haier and China Eastern Airlines are already piloting blockchain-based cross-border payments. Aligning early with such digital currency systems could offer long-term advantages.
Global Wealth Shift: Blockchain’s Geopolitical Play
Pan’s words hint at something larger: a historic financial pivot. When Chinese digital currency is used to settle international trade — from Brazilian soybeans to Middle Eastern oil to Russian gas — the landscape will shift.
Analysts predict:
- USDT’s market cap could drop from $110 billion to just $30 billion.
- Crypto exchanges aligned with CBDC settlements (e.g., OKX) may see user growth double.
- Government bond-backed stablecoins may offer retail investors up to 8% annual yields.
The Takeaway: Feast or Be Fuel
This isn’t just a tech update — it’s a financial reset. As Pan Gongsheng’s statement underscores, blockchain is no longer the domain of fringe developers and crypto startups. It’s a national strategy. A digital arms race. And for private stablecoins, the writing may be on the wall.
“This blockchain revolution led by the national team means either you feast… or you become fuel.”
