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As the US is intensifying its suppression on China, some noted that the US may make decoupling moves in the  financial sector after trade and technology, as there have been reports that the US may cut China off from the dollar payment system SWIFT.

China needs to be well prepared to deal with such potential decoupling moves and protect the value of the nation's and the people's fortune, especially financial assets such as currency holdings and securities.

Unlimited quantitative easing (QE) has let the US dollar and US Treasury bills to lose their advantage in safety, liquidity and yields. However, the US Federal Reserve continues stimulus measures as the US can't revitalized its economy during the raging pandemic.

While the US economy still grapples with mounting downward pressures, and is still struggling to manage the COVID-19 crisis , China should take actions to efficiently protect the value of its assets.

For starters, the distorted US dollar hegemony needs to be dispelled. Since US president Richard Nixon ended convertibility of US dollars to gold in 1971, the currency has become a debt currency rather than an asset currency. US national debt exceeds $26 trillion, and its fiscal deficit soared $863 billion in June, showing the country is using the US dollar's special status to endure the current crisis. To expose the harm that the currency brings to its international users is a crucial step in preparing for a possible financial crackdown by the US.

The dollar-denominated settlement and statistics for cross-border business need reforming. In recent years, China has done a lot of work on yuan's internationalization, but yuan-denominated settlement still only accounts for a small percentage of overall cross-border trade and investment. It's time to change some of these conventional operations.

Allowing companies to use yuan-denominated settlement in cross-border businesses should be put on the agenda. The most fundamental condition for accelerating the yuan's internationalization is the increase in transaction usage. China could encourage Chinese companies, especially state-owned enterprises to use yuan-denominated settlement in overseas projects, and provide incentives to companies that reach a certain percentage in yuan-denominated settlements.

China should set up a yuan payment fund to support other countries that import products from China. In the current pandemic situation, some countries need to import medical supplies and a yuan payment fund will help them get used to yuan payment channels. Letting the international community understand Chinese financial institutions can provide fair, timely, accurate, and professional clearing and settlement services for cross-border businesses is conducive to attracting more countries to use yuan-denominated settlement.

In order to effectively prevent Washington from taking extreme moves in the financial field, it is necessary to caution Chinese non-financial institutions and the public to strengthen US dollar asset protection against potential risks.

The author is a former vice president of the Bank of China. bizopinion@globaltimes.com.cn