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The PBoC reiterated that digital assets have no legal status in China
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The central bank flagged stablecoins as failing AML and KYC standards
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Officials cited stablecoins as threats to financial stability and national security
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China says its 2021 mining and trading bans have reduced market “chaos”
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Authorities also warned Hong Kong firms about tokenization and stablecoin activity
Beijing Restates Its Stance Against Crypto
China’s central bank reiterated its position that digital asset operations remain illegal in the country. Following a meeting involving thirteen government agencies, the PBoC said cryptocurrencies lack legal tender status and cannot be used as currency within China.
The bank reaffirmed its commitment to crack down on illegal crypto activity, saying earlier bans have already “rectified the chaos” in the virtual currency market.
Stablecoins Under Heightened Scrutiny
The PBoC singled out stablecoins as a top risk, arguing they do not meet anti money laundering and customer identification standards. The central bank warned that stablecoins can be used for underground payments, cross border transfers, and fraudulent fundraising, posing threats to financial security.
Hong Kong’s Crypto Push Draws Attention
While Hong Kong has embraced regulated crypto exchanges and stablecoin issuers, Beijing has recently pressured local firms to pause tokenization initiatives and stablecoin plans. At the same time, China continues to promote its digital yuan pilot, with more than 225 million wallets opened.
