Alibaba’s cross-border e-commerce unit is reportedly working on a deposit token amid China’s regulatory crackdown on stablecoins, CNBC reported.

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The report comes after Chinese tech firms, including Ant Group and JD.com, paused their HongKong stablecoin plans following guidance from mainland regulators over concerns about private control of currency‑like instruments.

Alibaba Follows JPMorgan with Deposit Token

Alibaba president Kuo Zhang told CNBC that the company plans to use stablecoin -like technology to streamline overseas transactions. The deposit token under consideration is a blockchain-based instrument representing a direct claim on commercial bank deposits and is treated as a regulated liability of the issuing bank.

China Tightens Crypto Rules as Tokens Grow

Traditional stablecoins are issued by private entities and backed by assets to maintain value. Alibaba’s move follows a report that JPMorgan Chase rolled out its deposit token to institutional clients earlier this week.

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In late September, a Caixin report suggested Chinese firms in HongKong could face restrictions on cryptocurrency activities, including limits on mainland investments in crypto and crypto exchanges.

The report was later removed. Earlier, in August, authorities instructed local firms to stop publishing research and holding seminars on stablecoins, citing concerns that these tokens could facilitate fraud.

Offshore Yuan Stablecoins Target Foreign Markets

Despite restrictions on the mainland, Chinese entities have maintained some involvement in stablecoins abroad. In July, blockchain firm Conflux introduced a new stablecoin backed by offshore Chinese yuan for overseas entities and countries linked to China’s Belt and Road Initiative.

A regulated stablecoin tied to the international version of the yuan also launched in late September, targeting foreign exchange markets. Joshua Chu, co-chair of the Hong Kong Web3 Association, said, “China is unlikely to issue stablecoins onshore.”