Coinbase Warns US Stablecoin Restrictions Could Boost China's CBDC Adoption
Coinbase has warned that a renewed push in the United States to restrict rewards on stablecoins could weaken the dollar's role in digital payments, especially as China upgrades its central bank digital currency (CBDC) with new interest-bearing features. Faryar Shirzad, Coinbase's chief policy officer, argued that the GENIUS Act restrictions and current US policy risk boosting the adoption of non-US stablecoins and CBDCs.
The GENIUS Act, signed in July 2025, sets reserve and compliance standards for stablecoins and bars issuers from paying direct interest on them but allows rewards tied to stablecoin usage. Meanwhile, China's People's Bank of China (PBOC) announced a framework in late December 2025, enabling commercial banks to pay interest on digital yuan wallets starting January 1, 2026. Lu Lei, a PBOC official, explained that this initiative aims to integrate the e-CNY into banks’ asset and liability operations.
As of November 2025, China's e-CNY had recorded 3.48 billion transactions worth approximately 16.7 trillion yuan (around $2.34 trillion), across 230 million personal wallets and about 19 million corporate wallets. However, adoption of the e-CNY still lags behind private apps like Alipay and WeChat Pay, which together control more than 90% of China's mobile payments market. User incentives and privacy concerns have contributed to this slower adoption rate. Nevertheless, after the announcement of the interest-bearing digital yuan wallets, Chinese investors poured more than $188 million into digital yuan-related stocks.
The US policy backdrop includes a January executive order signed by then-President Trump, barring federal agencies from issuing or supporting a CBDC and signaling a preference for privately issued, regulated stablecoins.
