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China Escalates Crypto Ban, Targets Stablecoin Payments in Coordinated Crackdown

Regulators pivot to policing stablecoin payments with tighter cross‑agency monitoring.

Overview

  • China’s central bank restated that virtual currencies lack legal tender status and declared all related business activities illegal.
  • The PBOC singled out stablecoins for failing KYC and anti‑money‑laundering standards, warning of money‑laundering, fraud, and unauthorized cross‑border transfers.
  • A multi‑agency coordination meeting directed stronger information sharing and close tracking of information and capital flows to intensify enforcement.
  • Officials noted a resurgence in speculation since the 2021 ban, while industry data and sources report a quiet rebound in bitcoin mining in energy‑rich provinces.
  • Hong Kong’s stablecoin framework remains without licensed issuers as Beijing intervened in tokenization plans, and crypto‑linked Hong Kong stocks fell following the PBOC statement.