China Doubles Down on Crypto Ban After Detecting New Trading Activity
China’s central financial institution has reasserted its strict prohibition on crypto buying and selling following indicators of renewed hypothesis in digital belongings.
The People’s Bank of China convened a high-level assembly on November 28, 2025, with 13 authorities companies to coordinate enforcement and crack down on unlawful digital forex actions which have just lately resurfaced regardless of years of sweeping bans.
The assembly particularly flagged stablecoins as posing dangers for cash laundering, fraud, and unlawful cross-border fund transfers.
Officials emphasised that digital currencies lack authorized tender standing and can’t perform as cash in China’s markets, whereas associated enterprise actions represent unlawful monetary conduct that undermines financial stability.
Hong Kong Stocks Tumble on Central Bank Warning
According to Reuters, Hong Kong-listed corporations with crypto publicity noticed sharp losses following the announcement of a renewed crackdown.
Yunfeng Financial Group, which has been increasing into tokenization companies, dropped greater than 10% in early Monday buying and selling. Bright Smart Securities fell roughly 7%, whereas digital-asset platform OSL Group misplaced over 5%.
The selloff mirrored market fears that Beijing’s hardline stance might derail Hong Kong’s ambitions to turn out to be a digital asset hub.
The metropolis handed stablecoin laws in May and obtained expressions of curiosity from greater than 40 corporations in search of licenses below its new regulatory framework, together with main monetary establishments like Circle and Standard Chartered.
Liu Honglin, founding father of Man Kun Law Firm, mentioned the central financial institution assertion “has erased any ambiguity, hypothesis and illusions” round China’s stablecoin insurance policies, noting that “regulators have drawn a concrete pink line on what was a imprecise borderline.“
Underground Mining and Enforcement Challenges Persist
Despite China’s complete ban on crypto buying and selling and mining since 2021, enforcement stays tough.
Recent information from Luxor’s Global Hashrate Map reveals China still accounts for 14.05% of Bitcoin’s total computing power, or roughly 145 exahashes per second, inserting it third globally behind the United States and Russia.
Authorities have uncovered a number of underground operations in current months.
In February, police dismantled a cross-border banking network that laundered over $136 million utilizing crypto to bypass monetary rules.
Investigators famous that 18 out of 49 underground banking instances in 2023 concerned digital forex transactions, demonstrating how criminals adapt to take advantage of digital belongings.
The central financial institution has additionally ordered social media platforms to shut down accounts selling crypto buying and selling.
In May, the Cyberspace Administration of China closed greater than a dozen accounts on Weibo, Douyin, and WeChat that have been spreading false data and inducing residents to take part in digital forex transactions by offshore exchanges.
Similarly, in August, Chinese regulators instructed brokerages and analysis establishments to halt the publication of studies or the hosting of seminars on stablecoins.
Local governments in Beijing, Suzhou, and Zhejiang have issued warnings about illicit fundraising linked to digital currencies.
At the identical time, over-the-counter crypto buying and selling volumes reached an estimated $75 billion within the first 9 months of 2024.
Stablecoins Draw Intensified Regulatory Scrutiny
Chinese officers have expressed explicit concern concerning the world growth of dollar-backed stablecoins, which they view as a strategic menace to the renminbi’s internationalization.
The sector’s complete market capitalization surpasses $300 billion, with Tether and USD Coin processing over $27 trillion in settlements over the previous yr.
Pan Gongsheng, governor of the People’s Bank of China, beforehand warned that stablecoins “have amplified weaknesses within the world monetary system” and fail to fulfill fundamental necessities for buyer identification and anti-money laundering controls.
The central financial institution has blocked main Chinese tech corporations, together with Ant Group and JD.com, from issuing stablecoins in Hong Kong, arguing that forex issuance should stay a state monopoly.
Wang Yongli, former deputy governor of the Bank of China, wrote in June that the dominance of USD-pegged stablecoins “poses a strategic problem” to the renminbi’s internationalization, warning that China’s efforts to advertise its forex overseas might face “critical obstacles” with out aggressive digital alternate options.
The assembly concluded with officers vowing to deepen coordination throughout companies, enhance monitoring capabilities, and severely crack down on unlawful actions to guard residents’ property and keep financial order.
Beijing continues selling its state-backed digital yuan as the one reliable various to personal cryptocurrencies whereas sustaining zero tolerance for them.
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