Chinese technology giants, including Ant Group and JD.com, have reportedly suspended plans to issue stablecoins in Hong Kong after regulators in Beijing voiced concerns over privately controlled digital currencies.

The companies were instructed by the People’s Bank of China (PBoC) and the Cyberspace Administration of China (CAC) to pause these initiatives, the Financial Times reported on Sunday, citing sources familiar with the matter.

“The real regulatory concern is, who has the ultimate right of coinage — the central bank or any private companies on the market?” one source familiar with the discussions told the FT.

Both companies had expressed interest earlier this year in joining Hong Kong’s pilot stablecoin program or launching tokenized financial products such as digital bonds.

Hong Kong’s stablecoin push hits a snag

Hong Kong began accepting applications for stablecoin issuers in August. Mainland officials had initially viewed the program as an opportunity to promote renminbi-pegged stablecoins and expand the yuan’s international footprint.

However, the momentum soon slowed down as Ye Zhiheng, executive director of the intermediaries division at the Hong Kong Securities and Futures Commission (SFC), warned that the city’s new stablecoin regulatory framework has heightened the risk of fraud.

Ye’s remarks followed stablecoin companies operating in Hong Kong posting double-digit losses on Aug. 1, just after the new stablecoin regulation came into force.

Last month, Chinese financial outlet Caixin reported that Beijing had restricted Hong Kong’s stablecoin activity. However, the report was removed shortly after publication, casting doubt on its claims.

China U-turns on Hong Kong tokenization push

Last month, China’s securities watchdog also reportedly instructed several local brokerages to pause their real-world asset (RWA) tokenization activities in Hong Kong, signaling Beijing’s growing unease with the rapid expansion of offshore digital asset ventures.

The move came as tokenization gains momentum in the country. Last week, CMB International Asset Management (CMBI), a Hong Kong-based subsidiary of a major Chinese commercial bank, China Merchants Bank (CMB), tokenized its $3.8 billion money market fund (MMF) on BNB Chain.