The First Chinese CNH Stablecoin as the Global Race Gathers Pace

In a signification moment for digital finance, the global stablecoin market is currently experiencing unprecedented activity as country after country rushes to create a digital version of its currency to combat U.S. dollar-pegged tokens. This week saw the launch of two historical stablecoins; the first regulated offshore yuan (CNH)-pegged stablecoin in China, called AxCNH, and the first KRW (Korean won)-pegged stablecoin in South Korea, called KRW1.

 

These two events show a geopolitical shift where nation states are using blockchain to facilitate international trade, enhance monetary sovereignty and try to control the dynamic inflationary pressures created by fiat currency printing. As the total addressable market for stablecoins moves from a niche crypto environment into a broader economic context, total stablecoin market capitalization has advanced to over $255 billion in 2025, almost 99% still currency pegged to U.S. dollars- that dominance has been breached.

The Launch of AxCNH: China's Digital Move to Global Trade

Financial technology company AnchorX made headlines on September 17, 2025, by launching AxCNH at the 10th Belt and Road Summit in Hong Kong, a venerable event co-chair by the Hong Kong SAR Government and Hong Kong Trade Development Council. Backed at a 1:1 ratio to the offshore Chinese yuan (CNH), which is the version of the renminbi used to trade in international markets, AxCNH is the first sanctioned stable token of its kind in the world.

 

The token, secure and held under the regulatory supervision of Kazakhstan’s Astana Financial Services Authority (AFSA), where AnchorX also secured the country's first stable token license in February 2025, is fully collateralized by physical deposits and government debt instruments held in custody. 

 

AnchorX is a Central Asia fintech adhering strictly to regulation and working to deliver compliant digital solutions. The firm designed AxCNH to enhance cross-border payment and settlement systems for offshore Chinese businesses and participants in China's Belt and Road Initiative (BRI). The BRI, first launched in 2013, is Beijing's $1 trillion+ flagship infrastructure plan to connect China to 140+ countries across Asia, Europe, Middle East and Africa, through roads, railroads, deepwater ports and digital corridors.

 

In 2024 alone, China's trade with BRI countries reached RMB 22.1 trillion ($3.1 trillion), which represents over 50% of its total trade volume. AxCNH was created to offer users a systems and transaction speed layered in a solutions that would otherwise encounter time, inefficiencies, and fees of 6-7% of the transaction volume using traditional systems like SWIFT which can take days to settlement. AxCNH provides settlement over the Conflux blockchain that can execute immediate, low-cost transactions.

A Significant Partnership Illustrates AxCNH's Real-World Application

AnchorX is working with Zoomlion, a worldwide mechanical equipment company with a significant presence and activity in more than 100 countries, including heavy BRI involvement. In 2024, Zoomlion generated approximately RMB 23.4 billion in revenue from overseas, representing more than 50% of the company's total revenue, and the two companies have used AxCNH for payments on Conflux, confirming there is no friction for payments associated with BRI-related transactions. Additionally, AnchorX has signed a listing agreement with ATAIX Eurasia, a licensed crypto exchange in Kazakhstan, which prepares AxCNH for a broader application. In a July 2025 interview, AnchorX founder Hill Wang explained that AxCNH is aligned with the BRI's growth corridors where bilateral trade between China and Kazakhstan is growing 20 - 30% a year alone implying "sustainable application scenarios" for AxCNH.

This introduction comes after a tacit regulatory change in China which issues a domestic ban on trading and mining in crypto but has allowed offshore stablecoins to introduce internationalization of the yuan. Moreover, Hong Kong is prepared to implement a stablecoin licensing regime shortly which could also help to expedite the rollout of AxCNH. The announcement generated conversation on X (formerly Twitter), led by users like @criptoconfi who called the launch a "historic milestone" for Conflux and expected onboarding to create liquidity for ecosystem tokens like $CFX.

KRW1 Joins the Party: South Korea's Attempt at Digital Sovereignty

Following in the footsteps of AxCNH, the South Korean digital asset custodian BDACS launched KRW1 on September 18, 2025, the peninsula's first regulated stablecoin pegged to the won. Built on Avalanche's blockchain for scalability with low fees, KRW1 is over-collateralized with a 1:1 ratio, and the deposits of Korean won are held in escrow at Woori Bank, one of the largest banks in the country, and after a successful proof-of-concept (PoC) phase, the token includes API connections to pull reserves in real time - transparency, and trust being paramount in an industry that has seen significant de-pegging events, for example in 2022 with TerraUSD.

 

BDACS, based in Seoul, hopes that KRW1 can serve as a versatile mechanism for a wide range of transaction types: remittances, digital payments, investment opportunities, deposits, and even in applications in the public sector, such as the disbursement of emergency relief. South Korea’s cryptocurrency market is booming and, in just Q1 2025, stablecoin trades on USD-pegged tokens exceeded 57 trillion won ($42 billion). BDACS wants to provide an alternative to USD-pegged tokens, such as USDT and USDC, which make up the majority of tokens used on the local exchanges.

 

The launch of KRW1 leads up to a new Digital Asset Basic Act, expecteed to become law in 2026, which will require issuers to have a minimum of 500 million won ($368,000) in capital to issue new tokens, as well as to be fully reserved. President Lee Jae Myung has gone on record stating he wants to see a won-pegged stablecoin as a way to maintain monetary sovereignty in the face of the rise of digital finance.

The participation of Avalanche accelerates the layering: Head of Asia Justin Kim stressed the "high-performing and reliable" infrastructure network for regulatory-compliant tokens. Reactions to the X post were exuberant, with @avax and @BlizzardFund calling it a "milestone" in the digital economy of Korea - a possible bridge between fiat and blockchain for broader access. Other competitors - Kakao, which is building KRWGlobal on its Kaia chain, and a consortium of eight banks, including KB Kookmin and Shinhan, which before the year is out have ambitions for a won stable coin by late 2025 or early 2026 are entering the space, too.

The Broader Global Stablecoin Race: A Geopolitical Chessboard

These launches are not isolated; they reflect a worldwide sprint to tokenize national currencies. Stablecoins, once a crypto periphery, now process $20-30 billion in daily on-chain payments, up an order of magnitude since 2021, per McKinsey. Governments view them as geo-strategic levers: by "placing fiat on digital rails," they aim to inflate demand for local currencies, offset printing-induced inflation, and erode the dollar's 88% share of global SWIFT transactions.

 

 

Other mentionables are the SIO Module for dinar-pegged tokens from Bahrain and the COPW for peso-backed retail use from Colombia. The IMF warns that dollar-pegged stablecoins already have more holdings of U.S. Treasuries than Saudi Arabia, which could change market behavior for Treasuries and FX markets. At the same time, risks are present; for example, depegging (such as fluctuations >3%) could lead to runs, and algorithmic models could be banned in certain areas, like the EU.

In terms of implications, changes in innovation, risks and the future ahead. 

For businesses, AxCNH and KRW1 present transformative efficiency - settling transactions in seconds, rather than days, at a fraction of the cost, all while unlocking deeper BRI integration and consolidating the Korean DeFi. For investors, there is an opportunity for diversification: the likelihood of non-dollar stablecoins fragmenting the largest liquidity pools may compromise crypto pairs and yields. From a geopolitical perspective, this "stablecoin arms race" is a competition between U.S. innovation, in the context of the GENIUS Act, China with its BRI and Europe with a MiCA framework and harmony that may lead to the privatization of seigniorage and a reduced role for traditional banking.

All of this is not without challenges. Even as we stay vigilant regarding regulatory issues, money laundering, and financial stability (along the lines of the comment by the IMF that there is "hollowing out" of banks), in the spirit of @arcaview, "China’s yuan just went on-chain… putting Beijing in the middle of the global stablecoin arms race." Alongside those trends, and as the Atlantic Council shows, 49 countries globally are currently piloting CBDCs or stablecoins, leading to increased anticipation that by 2025 we may reach the tipping point in which digital fiat becomes a reality in the global financial landscape.

 

This article is contributed by an external writer: Natalia Ivanov, Crypto Whales Info.

 
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The race is on-and no longer a broken American dollar race. For now, AxCNH and KRW1 are signs of the assertive first steps toward Zealand integrating the capabilities of blockchain and sovereign with speed and strategy, respectively. If and when this adoption and progress build on each other through time, the true "winners" or masses will be those moving across borders connecting people without building walls.