# China's Central Bank Outlines Collateral Rules for Bond Backstop By Riza Dagoc Canonical URL: https://www.tokenpost.com/news/regulation/36980 Published: 2026-10-21T19:46:51.000Z Updated: 2026-10-21T19:46:51.000Z Section: Regulation > The proposed facility would address a cycle of fund withdrawals and bond sales during marketwide stress. Digital yuan operators have increased from 10 to 30. The People's Bank of China (PBOC) plans to require high-grade collateral for a proposed liquidity backstop aimed at breaking a cycle of fund withdrawals and bond sales during marketwide stress. PBOC Gov. Pan Gongsheng announced the plan at a Beijing forum Oct. 19. The central bank is developing [the joint liquidity facility]() with the National Financial Regulatory Administration and the China Securities Regulatory Commission. The facility is intended for periods when asset managers face marketwide liquidity pressure and redemptions drive bond sales that lead to further withdrawals. Bank wealth management subsidiaries and public fund managers would be eligible, along with their corresponding parent banks and parent securities firms. Participants would also have to meet macroprudential requirements. “We try to strike a fine balance between forestalling systemic financial risks and preventing moral hazard in financial markets,” Pan said. Pan also put the number of institutions operating the digital yuan (e-CNY) at 30, up from 10. The expanded network of digital yuan operators covers all of China's systemically important banks. The PBOC changed the e-CNY's statistical classification from cash to deposit money earlier in 2026, part of [broader changes to the digital yuan](). Its Beijing E-CNY Center, established in 2025, is fully operational and handles issuance, retail and wholesale business, blockchain services and smart contracts. The PBOC plans to publish operating details for the proposed liquidity facility in later open market operations announcements. ## Links in this article - [the joint liquidity facility](https://www.tokenpost.com/news/regulation/35468) - [broader changes to the digital yuan](https://www.tokenpost.com/news/regulation/18172)