One of the worst kept secrets in crypto has finally to fruition: Tether is launching a stablecoin tied to the Chinese yuan.
As we reported three weeks ago, Bitfinex shareholder and RenrenBit founder Zhao Dong spilled the beans to China’s ChainNews that “Tether will issue CNHT in the near future and anchor the stable currency of offshore renmimbi.”
Sure enough on Monday, Tether issued a short statement:
“We are pleased to announce the addition of offshore Chinese yuan (CNH) to our basket of supported currencies, and the launch of a new stablecoin, CNH₮.
“CNH represents a further expansion of Tether’s capabilities in facilitating the digital use of traditional currencies, such as US dollar (USDT) and euro (EURT).
“CNH₮ is pegged to CNH, and will initially be available only on the Ethereum blockchain as an ERC-20 token.
“Contract address: https://etherscan.io/token/0x6e109e9dd7fa1a58bc3eff667e8e41fc3cc
“We invite any exchange seeking assistance to support CNH₮ to contact us at firstname.lastname@example.org.”
Demand from Chinese nationals for a product denominated in their home currency remains uncertain. The company’s USD-based coin currently may (perhaps) have some demand from people in China looking to skirt the country’s capital controls. And a yuan-based currency could find some acceptance.
But the People’s Bank of China is said to be working on its own stablecoin. China may have a competitive marketplace but it’s still a communist country or, at least, one with a heavy-handed government (we’re being kind here). They may not just simply frown on an offshore stablecoin based on the currency they control—especially one accused of printing its tokens without assets backing it up. That’s a central bank’s job.