Archive · 29 Nov 2025
China Cracks Down on Virtual Currency and Stablecoins
China's central bank, the People's Bank of China, had a meeting about virtual currencies.
They said that virtual currencies like Bitcoin are not legal money in China and cannot be used to buy things.
The bank is worried about people speculating on these currencies and using them for bad things like money laundering.
They are especially concerned about stablecoins, which are a type of virtual currency that is supposed to be stable in value.
The bank said that stablecoins don't have the right protections against money laundering and fraud.
They also mentioned that Hong Kong has rules for stablecoins but hasn't given any licenses yet.
In China, trading cryptocurrencies has been banned since 2021, and Bitcoin mining was banned four years ago.
But some people are still mining Bitcoin in China because electricity is cheap and there are many new data centers.
China's central bank, the PBOC, reaffirmed its tough stance on virtual currencies, warning of increased speculation and illegal activities.
Virtual currencies do not hold legal status as fiat currency and cannot be used as legal tender in China.
The PBOC highlighted concerns about stablecoins, stating they fail to meet customer identification and anti-money-laundering controls.
Stablecoins risk being used for illegal activities such as money laundering, fraud, and unauthorized cross-border fund transfers.
The PBOC vowed to intensify efforts to combat illegal financial activities related to virtual currencies to maintain economic and financial stability.
- Who
- People's Bank of China (PBOC)
- What
- Crackdown on virtual currencies and stablecoins, warning about increased crypto speculation and illegal activities
- When
- Meeting on Friday, statement released on Saturday
- Where
- China, with mention of Hong Kong's regulatory regime
- Why
- To maintain economic and financial stability, and due to concerns about illegal financial activities and risks associated with stablecoins
- Organization
- People's Bank of China (PBOC)
- Date of Meeting
- Friday (before the statement was released on Saturday)
- Legal Status of Virtual Currencies
- Do not hold the same legal status as fiat currency and cannot be used as legal tender
- Concerns about Stablecoins
- Fail to meet customer identification and anti-money-laundering controls
- Potential Risks of Stablecoins
- Money laundering, fraud, unauthorized cross-border fund transfers
- Regulatory Status in Hong Kong
- Has a regulatory regime for stablecoins but has not awarded any licenses to issuers
- Cryptocurrency Trading Ban in China
- Banned since 2021
- Bitcoin Mining in China
- Banned four years ago, but mining is quietly staging a comeback due to cheap electricity and data center boom
