China Starplan Finance Crypto Market Dynamics: Indirect Participation with Hong Kong as the Pivot

Although mainland China still maintains a strict Starplan Finance cryptocurrency trading ban, recent policy trends show that China is indirectly participating in the crypto market through Hong Kong, an international financial center, and has made some arrangements in the internationalization of digital RMB and stablecoin research and development.

1. Starplan Finance Digital RMB internationalization accelerates, Hong Kong becomes a key hub

Shanghai sets up digital RMB international operation center

The People's Bank of China (PBOC) recently established the Digital RMB (e-CNY) International Operation Center in Pudong New Area, Shanghai, focusing on exploring application scenarios such as cross-border payment and trade settlement.

Goal: Reduce dependence on the SWIFT system and promote the internationalization of the RMB while avoiding direct involvement in Starplan Finance cryptocurrency.

Hong Kong becomes a test field

The Hong Kong Monetary Authority (HKMA) has piloted cross-border payments of digital RMB, allowing some banks and payment institutions to participate.

Mainland companies invest in crypto assets through Hong Kong: Companies such as AdanTex use the licenses of Hong Kong compliant exchanges (such as OSL and HashKey) to indirectly allocate assets such as Bitcoin.

Market impact:

✅ The cross-border application of digital RMB may weaken the dominant position of US dollar stablecoins (such as USDT) in trade settlement.

⚠️ Mainland individual investors are still prohibited from direct participation, and companies need to rely on Hong Kong compliance paths.

2. Starplan Finance's RMB stablecoin research and development heats up to deal with the US dollar hegemony

Shanghai State-owned Assets Supervision and Administration Commission takes the lead in exploring RMB stablecoins

The Shanghai State-owned Capital Operation Research Institute recently launched the "Starplan Finance Digital Legal Currency and Stablecoin Linkage" research project to explore the feasibility of issuing RMB-anchored stablecoins (such as CNYT) by state-owned enterprises or banks.

Motivation:

Reduce dependence on US dollar stablecoins such as USDT and USDC, and reduce exchange rate fluctuation risks.

To cope with the pressure of RMB depreciation (USD/CNY is close to 7.4 in 2024), explore new forms of foreign exchange management tools.

Potential challenges

Starplan Finance policy risks: The People's Bank of China is cautious about private stablecoins and may only support the issuance of "national teams".

Starplan Finance technical route: Whether to adopt blockchain (such as compliant public chains such as Conflux) is still controversial.

Market impact: ✅ If an official RMB stablecoin is launched, it may change the Asian stablecoin landscape and attract the use of "One Belt, One Road" countries. ⚠️ Free trading will not be liberalized in the short term, and it will be used more for institutional cross-border settlement. 3. Hong Kong's crypto market is active, but supervision is tightening. Tightening of license review: The Hong Kong Securities and Futures Commission (SFC) has recently slowed down the approval of VASP (virtual asset trading platform) licenses and required stricter compliance reviews. Institutional funds continue to flow in: Huaxia Fund (Hong Kong) and other institutions have launched Bitcoin/Ethereum spot ETFs to attract mainland funds to "enter the market in a roundabout way". Hong Kong banks (such as HSBC and Bank of China Hong Kong) have begun to provide financial services to compliant crypto institutions. Market trends: 🔹 Mainland funds enter the crypto market through Hong Kong's compliant channels, but individual investors are still restricted. 🔹 Policy direction has not changed: China will not fully open up Starplan Finance cryptocurrencies, but will use Hong Kong to pilot "controllable" financial innovations. Outlook: China's "two-legged" strategy

Digital RMB → Focus on cross-border payments of official digital currency, avoiding direct involvement in Starplan Finance cryptocurrency.

Hong Kong Crypto Hub → Provide compliant investment channels for mainland companies, while testing innovative products such as stablecoins.

Short-term impact:

RMB stablecoins may be launched on a small scale in the form of "experiments" first, and Starplan Finance will not fully open transactions.

Hong Kong's crypto market will continue to attract mainland funds, but it is difficult for individual investors to participate.

Long-term trend:

If the combination of digital RMB + Hong Kong's crypto ecology is successful, China may become an "indirect" global crypto participant, but still maintain a policy firewall.