When legislation opens the door: Wang Yongli warns that stablecoins may be "bitten back" by the wave of traditional financial RWA

On January 15, 2026, at the 18th Golden Kirin Forum held in Beijing, former Vice President of the Bank of China Wang Yongli’s speech cast a “deep water bomb” into the fields of global crypto finance and real-world assets (RWA). He candidly pointed out that the current legislative processes for stablecoins, which various countries are racing to promote, may cause “serious backlash” to the development of stablecoins themselves.

This seemingly contradictory assertion is based on a simple logical deduction: if legislation fails to clarify the legal status of stablecoins, licensed financial institutions like banks will hesitate due to compliance risks, leaving market opportunities to non-licensed tech giants like Tesla; however, once the law clarifies their legality, traditional financial giants will leverage their comprehensive advantages—regulation, capital, and customer trust—to fully “grab this market.” Wang Yongli keenly observed that this “backlash” is already quietly happening, marked by the trend in the U.S. where licensed institutions actively promote “deposit tokenization, RWA, stocks, bonds, funds ETF, and other assets quickly going on-chain.”

Wang Yongli’s warning acts like a lens, piercing through the routine discussions around stablecoin payment efficiency and compliant reserves, focusing instead on a deeper, reshaping industry landscape. From the perspective of RWA evolution, we find that this so-called “backlash” is essentially traditional finance leveraging its core physical assets (RWA), using legislative certainty to initiate a “dimensionality reduction competition” against crypto-native finance represented by stablecoins. The second half of the stablecoin war may not be about ultimately determining the payment king but could mark the beginning of a grand narrative led by traditional finance, on-chain global asset chains (RWA).

1. The Double-Edged Sword of Legislation: Why Clarifying Rules Might “Backfire” on Stablecoins?

Wang Yongli’s view does not deny the necessity of legislation but reveals the complex effects of legislation as a “double-edged sword.” The logical chain is clear and cold: unclear legislation → high compliance barriers → license-holding institutions wait and see → non-licensed entities (like tech companies) gain window periods; once legislation is clarified → clear compliance pathways → licensed institutions rush in → market structure is instantly overturned.

This “backlash” does not mean legislation will eliminate stablecoins but that their market dominance, core value, and even existence will be thoroughly reshaped by the entry of more powerful players. The involvement of traditional financial institutions is not just talk. For example, in June 2025, the “GENIUS Act,” aimed at establishing federal regulation for stablecoins, was passed by the U.S. Senate, seen as a milestone. Following this, Wall Street’s actions were swift and intense. Major institutions like JPMorgan Chase, Citibank, and Bank of America rarely spoke out collectively, publicly evaluating the possibility of issuing their own stablecoins or promoting tokenized deposits. Bank of America (BoA) even directly confirmed that it was actively preparing stablecoin products.

This situation aligns perfectly with Wang Yongli’s judgment. The “full effort” of financial institutions is no exaggeration; they bring not only capital but also an unmatched “regulatory foundation” for crypto-native entities. As Wang Yongli pointed out, the compliance foundation of financial institutions far surpasses that of non-licensed issuers. When regulation becomes clear, the entry of these “formal troops” will directly change the game rules. This means the stablecoin market will quickly evolve from a competition among tech companies and fintech startups into a brutal war involving globally systemic banks and top asset management firms. For organizations still vigorously developing stablecoins today, Wang Yongli’s conclusion—“opportunities are really running out”—is a sober recognition of this harsh turning point.

2. RWA Perspective: Why Are Stablecoins Just “Outposts”?

To truly understand the depth of “backlash,” one must shift the perspective from “stablecoins” to “RWA.” Currently, mainstream stablecoins (like USDT, USDC) primarily aim to become “the dollar on the blockchain,” solving on-chain value anchoring, payment settlement, and DeFi liquidity issues. Their backing assets mainly include U.S. Treasuries, commercial paper, and other short-term high-liquidity assets.

However, for traditional financial giants like JPMorgan Chase, BlackRock, and Fidelity, the payment issues solved by stablecoins are just a tiny part of their vast business systems. Their real core advantage and strategic ambition lie in their management of massive, income-generating physical assets. Tokenizing these traditional assets (bonds, loans, fund shares, even equities) efficiently and compliantly—i.e., RWA—and building a new on-chain financial infrastructure is the ultimate goal of this transformation.

Therefore, when Wang Yongli mentions “deposit tokenization, RWA, securities on-chain,” he is pointing to the true track after traditional financial institutions enter. For banks, “deposit tokenization” essentially means turning their core liabilities (deposits) into RWA. For example, JPMorgan Chase officially launched its deposit token JPM Coin on the Base blockchain in November 2025, directly corresponding to bank deposits within JPMorgan’s system, which are regulated liabilities. This is fundamentally different from stablecoins like USDC issued by private entities, which are asset-backed and have different regulatory and credit attributes. This is undoubtedly a direct competition and an upgrade to the existing stablecoin business model.

For asset management firms, their battlefield is to RWA-ify the managed fund products. BlackRock’s BUIDL fund, launched in March 2024, exemplifies this trend. BUIDL is essentially a regulated money market fund with underlying assets in U.S. Treasuries and repurchase agreements, circulating on the blockchain via tokenization. By 2025, its assets under management had rapidly grown to tens of billions of dollars and was integrated as core collateral in multiple DeFi protocols. Fidelity followed with a similar on-chain money market fund, FDIT, launched in September 2025, reaching over $200 million in short order.

These cases clearly show that after traditional financial institutions enter, the focus of competition shifts rapidly from “who issues better on-chain USD” to “who can bring more and higher-quality real-world assets on-chain.” Stablecoins may evolve from the “main character” of this transformation into a “bridge” or “building block” connecting the fiat world with the on-chain RWA ecosystem. When the chain is flooded with interest-bearing U.S. Treasury tokens backed by BlackRock and Fidelity, the appeal of pure payment stablecoins without yield will inevitably be diverted. This is the deepest meaning of “backlash”: the core value proposition of stablecoins is being absorbed and reconstructed by a grander RWA narrative.

3. Reshaping the Landscape and Survival Challenges: Crypto Native Institutions at a Crossroads

Faced with the strong entry of traditional financial institutions leveraging RWA advantages catalyzed by legislation, the current crypto-native ecosystem stands at a critical crossroads. The challenges are specific and severe.

The primary challenge is the exponential increase in compliance thresholds. Traditional financial institutions are already under strict regulatory networks, and their RWA products (like BUIDL, FDIT) are designed from inception to follow regulations such as the 1933 Securities Act, targeting “qualified purchasers.” In contrast, crypto-native stablecoin issuers need to build compliance systems from scratch. For example, Circle, to strengthen the compliance foundation of USDC, applied in 2025 to establish a national trust bank with the U.S. Office of the Comptroller of the Currency (OCC), aiming for federal regulatory status. This path is long and costly.

Second, in wholesale finance and institutional markets, the advantage of crypto-native institutions may quickly diminish. Traditional financial institutions have decades or even a century of trust and cooperation with global corporations, governments, and large investors. When JPM Coin appears, JPMorgan’s existing institutional clients can seamlessly use this service without facing new counterparty risks. This is a moat that startups find hard to build in a short time.

Moreover, the business ceiling is within reach. If the business model remains focused on issuing and operating stablecoins, the dual pressures of deposit tokenization and interest-bearing RWA products will continue to erode market space. Relying solely on transaction fees and reserve interest makes the business model fragile under the crushing competition of giants.

However, within these challenges lie insights and opportunities. Crypto-native institutions are not without options; the key is to reposition themselves within an irreplaceable ecological niche.

First, leverage agility and innovation, focusing on RWA of long-tail and emerging assets. Traditional finance tends to tokenize the most standard, largest-scale assets (like government bonds, investment-grade bonds) due to risk preferences and compliance costs. This leaves ample space for crypto-native institutions to explore tokenization of more complex, non-standard assets such as private equity, real estate, intellectual property, carbon credits, and supply chain finance.

Second, explore cooperation with traditional financial institutions, becoming “enablers” rather than “competitors.” Many traditional institutions lack experience in blockchain technology, tokenomics, and community operations. Crypto-native projects can transform into technology solution providers, asset originators, or distribution channels. For example, several DeFi protocols have integrated BUIDL as core collateral, which is a successful form of cooperation.

Third, extend business focus to the mid- and downstream of RWA. Even if the issuance side is dominated by giants, there are still huge opportunities in on-chain financial services such as trading, lending, portfolio management, and derivatives innovation. Building more efficient RWA secondary markets and developing more complex structured products may be more promising directions.

4. Entering Deep Waters: Dancing with the Whales

Wang Yongli’s warning about “backlash from stablecoin legislation” is valuable because it forces the industry to adopt a sober perspective shift. It reminds us that the development of crypto has moved from a relatively independent “money internet” experiment into the “deep water zone” of “financial system reconstruction,” where deep collision, integration, and competition with the global traditional financial system are taking place.

In this new phase, the biggest variables and most powerful players come from outside the system. Legislation is not the endpoint but a clear “ticket” for entry. When JPMorgan Chase, BlackRock, Fidelity hold this ticket and enter the arena with their trillions in assets and unparalleled credit backing, the game rules have already changed. The competition among stablecoins is rapidly merging into a larger narrative aimed at “global asset on-chainization” as the ultimate goal.

For crypto-native institutions, the question is no longer just “whether they will be backlash,” but “how to find their indispensable ecological niche in this new battlefield dominated by traditional finance.” Whether to specialize in a niche, transform into partners of giants, or continue differentiated competition in payments—this reshuffle triggered by legislation will determine the industry’s power map in the next phase. The only certainty is that the era of easily winning through first-mover advantages and regulatory arbitrage is gone forever.

Partial source references:

· “Wang Yongli: Stablecoin Legislation May Cause Serious Backlash”

· “Wang Yongli: The US Dollar Stablecoin Still Faces Many Challenges”

· “JPMorgan Chase Launches JPM Coin Deposit Token on Base for Instant Payments”

Author: Liang Yu Editor: Zhao Yidan