On January 15, 2026, at the 18th Golden Kirin Forum held in Beijing, Wang Yongli, former vice president of the Bank of China, delivered a speech that dropped a bombshell on the global crypto finance and real-world assets ( RWA ) sector. He bluntly pointed out that the current legislative processes for stablecoins, which are being pursued by various countries, may have a "serious backlash" on the development of stablecoins themselves.
This seemingly contradictory assertion rests on a simple deduction: if legislation fails to clearly define the legal status of stablecoins, licensed financial institutions such as banks will hesitate due to compliance risks, leaving market opportunities for unlicensed tech giants like Tesla; however, once their legality is established, traditional financial giants will leverage their comprehensive advantages in regulation, capital, and customer trust to aggressively seize this market. Wang Yongli astutely observed that this "backlash" is already quietly occurring, marked by the trend in the US, actively driven by licensed institutions, of "deposit tokenization, RWA, and the rapid on-chaining of stocks, bonds, and ETFs ."
Wang Yongli's warning acts as a lens, piercing through the conventional discussions surrounding stablecoin payment efficiency and compliance reserves, and focusing on a deeper, reshaping industry landscape. Examining the evolution of RWA reveals that this so-called "backlash" is essentially a "lower-dimensional competition" launched by the traditional financial system, leveraging its core advantage of physical assets (RWA) and the certainty provided by legislation, against crypto-native finance represented by stablecoins. The second half of the stablecoin war may not determine the ultimate payment champion, but rather initiate a grand narrative dominated by traditional finance and the global asset on-chain (RWA) model.
I. The double-edged sword of legislation: Why might clear rules backfire on stablecoins?
Wang Yongli's viewpoint does not deny the necessity of legislation, but rather reveals the complex effects of legislation as a "double-edged sword." His logical chain is clear yet ruthless: unclear legislation → high compliance barriers → licensed institutions remain hesitant → non-licensed institutions (such as technology companies) gain a window of opportunity; once legislation is clear → clear compliance path → licensed institutions enter the market in large numbers → the market landscape is instantly overturned.
The "backlash" here doesn't refer to the legislature eliminating stablecoins, but rather to the complete restructuring of their market dominance, core value, and even their very existence due to the entry of more powerful players. The entry of traditional financial institutions is not just empty talk. Take the United States as an example: in June 2025, the GENIUS Act, aimed at establishing a federal regulatory framework for stablecoins, was passed by the Senate, considered a landmark event. Following closely, Wall Street's actions were swift and intensive. Leading institutions such as JPMorgan Chase, Citigroup, and Bank of America unusually and frequently made public statements, assessing the possibility of issuing their own stablecoins or promoting tokenized deposits. Bank of America (BoA) even directly confirmed that it is actively preparing stablecoin products.
This situation perfectly aligns with Wang Yongli's assessment. The "all-out effort" of financial institutions is not an exaggeration; they bring not only capital but also a regulatory foundation that native crypto institutions cannot match. As Wang Yongli stated, the compliance foundation of financial institutions is far superior to that of unlicensed token issuers. When regulations become clear, the entry of these "regular forces" will directly change the rules of the game. This means that the stablecoin market will rapidly evolve from an innovation competition between tech companies and fintech entrepreneurs into a brutal war against global systemically important banks and top asset management firms. For institutions still vigorously developing stablecoins today, Wang Yongli's conclusion—"opportunities are truly dwindling"—is based on a clear understanding of this harsh turning point.
II. RWA Perspective: Why is it said that stablecoins are just a "preliminary battle"?
To truly understand the depth of the "backlash," we must shift our perspective from "stablecoins" to "RWA." Currently, the core narrative of mainstream stablecoins (such as USDT and USDC) is to become "dollars on the blockchain," solving the problems of on-chain value anchoring, payment settlement, and DeFi liquidity. Their reserve assets are mainly short-term, highly liquid assets such as US Treasury bonds and commercial paper.
However, for traditional financial giants like JPMorgan Chase, BlackRock, and Fidelity, the payment problems solved by stablecoins are merely a small part of their vast business ecosystem. Their true core advantage and strategic ambition lie in the massive amounts of profitable physical assets they manage. The ultimate goal of this transformation is to efficiently and compliantly tokenize these traditional financial assets (bonds, credit, fund shares, and even equity) (i.e., RWA) and build a completely new on-chain financial infrastructure.
Therefore, when Wang Yongli mentioned "deposit tokenization, RWA, and on-chain securities," he was pointing to the real battleground after traditional financial institutions entered the market. For banks, the essence of "deposit tokenization" is to RWA their core liability (deposits). For example, JPMorgan Chase officially launched a deposit token called JPM Coin to institutional clients in November 2025 and deployed it on the Base blockchain. The key difference is that JPM Coin directly corresponds to bank deposits within the JPMorgan Chase system and is a regulated liability of the bank. This is completely different from stablecoins such as USDC, which are issued by private entities and backed by asset portfolios, in terms of regulatory attributes and credit foundation. This is undoubtedly a direct competition and a disruptive force against the existing stablecoin business model.
For asset management companies, the battleground is the realignment of their managed funds with Reverse Asset Payments (RWA). BlackRock's BUIDL fund, launched in March 2024, exemplifies this trend. BUIDL is essentially a regulated money market fund with underlying assets of US Treasury bonds and repurchase agreements, circulating on the blockchain through tokenization. By 2025, its assets under management had rapidly grown to billions of dollars and it had been integrated as core collateral by multiple DeFi protocols. Fidelity followed suit, launching a similar on-chain money market fund, FDIT, in September 2025, which also quickly surpassed $200 million in size.
These cases clearly demonstrate that after traditional financial institutions entered the market, the focus of competition quickly shifted from "who issues better on-chain dollars" to "who can bring more and higher-quality real-world assets onto the chain." Stablecoins may gradually evolve from being the "protagonists" of this transformation into "bridges" or "basic components" connecting the fiat currency world with the on-chain RWA ecosystem. When the chain is filled with interest-bearing US Treasury tokens backed by BlackRock and Fidelity, the appeal of stablecoins, purely as payment tools with no yield, will inevitably be diverted. This is the deepest meaning of the "backlash": the core value proposition of stablecoins is being absorbed and reconstructed by a grander RWA narrative.
III. Reshaping the Landscape and Survival Challenges: Crypto Native Organizations at a Crossroads
Faced with the powerful entry of traditional financial institutions leveraging their 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 within a tight regulatory network, and their RWA products (such as BUIDL and FDIT) have adhered to traditional financial regulations such as the Securities Act of 1933 from their inception, targeting "accredited buyers." In contrast, issuers of crypto-native stablecoins need to build their compliance systems from scratch. For example, to strengthen the compliance foundation of USDC, Circle applied to the Office of the Comptroller of the Currency (OCC) in 2025 to establish a national trust bank, aiming to obtain federal-level regulatory status. This path is long and costly.
Secondly, in the wholesale finance and institutional client markets, the advantages of crypto-native institutions may quickly diminish. Traditional financial institutions have decades, even centuries, of established relationships and trust with global corporations, governments, and large investors. When JPM Coin emerges, JPMorgan Chase's existing institutional clients can seamlessly utilize the service without facing entirely new counterparty risks. This is a moat that any startup will find difficult to build in a short time.
Furthermore, the business ceiling is within reach. If the business model remains focused on issuing and operating stablecoins in the long term, its market share will continue to erode in the face of pressure from deposit tokenization and interest-bearing RWA products. A business model that relies solely on transaction fees and reserve interest is exceptionally vulnerable to the overwhelming competition from industry giants.
However, challenges also contain insights and opportunities. Crypto-native institutions are not without a way out; the key lies in redefining their irreplaceable niche.
First, leverage agility and innovation to focus on RWA for long-tail and emerging assets. Traditional financial institutions, due to risk appetite and compliance costs, typically prioritize tokenizing the most standard and largest-scale assets (such as government bonds and investment-grade bonds). This leaves ample room for crypto-native institutions to explore tokenization of more complex and non-standard assets, such as private equity, real estate, intellectual property, carbon credits, and supply chain finance.
Secondly, explore collaborations with traditional financial institutions to become "enablers" rather than "competitors." Many traditional institutions lack experience in blockchain technology, token economics design, and community operations. Crypto-native projects can transform into technology solution providers, originators of specific assets, or distribution channels. For example, several DeFi protocols have integrated BUIDL as core collateral, which in itself is a successful collaboration.
Third, extend business focus to the mid-to-downstream of RWA. Even though the asset issuance end is dominated by giants, there are still huge opportunities for innovation in on-chain financial services such as asset trading, lending, portfolio management, and derivatives innovation. Building a more efficient RWA secondary market and developing more complex structured products may be a more promising direction.
IV. Sailing into deep waters, dancing with whales
Wang Yongli's warning about the "backlash of stablecoin legislation" is truly valuable because it forces the industry to undergo a sobering shift in perspective. It reminds us that the development of the crypto industry has moved from a relatively independent experiment in "the internet of money" to the deep waters of "financial system reconstruction," characterized by profound collisions, integration, and competition with the global traditional financial system.
In this new phase, the biggest variables and the most powerful players come from outside the system. Legislation doesn't provide the end point, but rather a clear "ticket to enter." When JPMorgan Chase, BlackRock, and Fidelity, holding this ticket and carrying their trillion-dollar balance sheets and unparalleled credit backing, enter the arena, the rules of the game have already changed. The competition among stablecoins is rapidly merging into a grander narrative culminating in the "global asset on-chaining."
For crypto-native institutions, the question is no longer simply "whether they will be backfired," but rather "how to find their indispensable niche in a new battlefield defined by traditional finance." Will they choose to become experts in a niche field, transform into partners with giants, or continue to differentiate themselves in the payments sector? This shift in the landscape triggered by legislation will determine the power structure of the industry in the next phase. The only certainty is that the era of easily winning through first-mover advantage and regulatory arbitrage is gone forever.
Some of the information comes from the following sources:
• Wang Yongli: Stablecoin legislation may severely backfire on stablecoins.
• Wang Yongli: Stablecoins for the US Dollar Still Face Many Challenges
JPMorgan Chase (JPM) launches JPM Coin deposit token on Base, enabling instant payments.
Author: Liang Yu; Editor: Zhao Yidan
