China’s Regulatory Response to Digital Currencies
In a decisive move to address the burgeoning challenges linked to digital currencies, the People’s Bank of China (PBOC) has unveiled a sweeping set of regulations aimed at mitigating risks in the fast-evolving digital asset landscape. This announcement comes in conjunction with several influential government bodies, including the National Development and Reform Commission (NDRC), the Ministry of Public Security, and the China Securities Regulatory Commission (CSRC), as reported by the prominent Beijing news outlet, Sina.
New Regulations on Virtual Currencies
Titled “Notice on Further Preventing and Disposing of Risks Related to Virtual Currencies,” the new directive firmly establishes that any business activities associated with virtual currencies are deemed illegal within China’s borders. This prohibition extends to both domestic operators and foreign entities they may control, clearly stating that they cannot issue virtual currencies abroad without obtaining the necessary approvals from the relevant authorities.
Furthermore, the notice strictly prohibits any entity — whether local or international — from issuing stablecoins tied to the Renminbi without prior approval. Additionally, it reinforces a longstanding ban on cryptocurrency mining within the country, assigning oversight of these activities to the NDRC to ensure strict compliance.
Historical Context and Ongoing Efforts
This recent directive is part of a long-standing pattern of regulatory actions taken by China against digital assets, dating back to 2013. Previous measures have included a significant crypto exchange ban in 2017, which precipitated a notable decline in the market, and a further crackdown on mining operations in 2021, which led to a large-scale relocation of mining operations to the United States. Most recently, in early December 2025, the PBOC reiterated its commitment to intensifying efforts against virtual currencies, specifically targeting stablecoins.
These developments underscore China’s ongoing struggle to assert control over the volatile digital currency space, reflecting a broader global concern regarding the implications of cryptocurrency on financial stability and regulatory integrity.
