China could challenge US digital asset lead via Hong Kong, American Treasury chief warns

US Treasury Secretary Scott Bessent said he “would not be surprised” if China is already looking into ways to challenge the US’ pre-eminence in digital assets, given Hong Kong’s efforts to develop the industry.

When testifying before the Senate Banking Committee on Thursday, Bessent said that there are “lots of rumors of Chinese digital assets” possibly being backed by something other than its currency yuan, such as gold, but that the US could not confirm such claims.

“We don’t know that for sure,” Bessent said, answering Wyoming Senator Cynthia Lummis’ question about whether China is trying to use digital assets and blockchain to “build an alternative to American financial leadership.”

“They have a very large sandbox in Hong Kong, and the [Hong Kong Monetary Authority] is actively traveling the world, looking at different mechanisms,” Bessent said. “So I wouldn’t be surprised.”