China's Official Ban on Virtual Assets

China’s PBOC Declares Virtual Assets Illegal in 2025

Key Points:

  • Virtual assets declared illegal by China’s PBOC.
  • No legal status for stablecoins, stricter regulations.
  • Crackdown on crypto trading, funding activities.

China’s People’s Bank of China has officially declared virtual assets, including stablecoins, as not having legal status, enforcing illegal restrictions on crypto activities. The announcement followed a high-level meeting involving top Chinese government departments.

China’s Continued Stance on Crypto

China’s largest financial institution, the People’s Bank of China (PBOC), confirmed the legal status of virtual assets. A meeting, involving the PBOC and various government agencies, stressed illegalities of crypto-related activities. This marks a continuation of 2017 policies.

The PBOC’s actions reinforce bans on trading and crypto financial services, including restricting access to digital currencies. Agencies involved included the Ministry of Public Security, reflecting a broad national coordination effort against crypto use.

The immediate effects are visible as crypto market activities reduce and underground trading risks increase. PBOC Governor stated, “Virtual assets are illegal financial activity… stablecoins do not meet KYC/AML standards and pose risks for underground payments and cross-border fraud.” The PBOC aims to prevent uncontrolled financial movements, which may impact internal economic stability while influencing global perceptions.

Financial markets may face disruptions due to restrictions on cross-border crypto movements. Political and business sectors could experience increased monitoring challenges. This could affect the standing of overseas exchanges offering services within China, as discussed in the impact of China’s cryptocurrency ban on U.S. SEC regulations.

Future Implications and Global Influence

Regulatory measures, historically anchored in 2017 and 2021 bans, suggest a persistent stance on digital assets. With rising global crypto adoption, China’s actions may prompt other jurisdictions to reconsider similar regulatory frameworks. Stricter control indicates China’s focus on mitigating perceived financial risks associated with crypto trading activities.

Disclaimer:

The content on nftenex.com is provided for informational purposes only and should not be considered financial or investment advice. Cryptocurrency investments carry inherent risks. Please consult a qualified financial advisor before making any investment decisions.