The Central Bank warned that stablecoins risk being used for illegal activities including money laundering, fraud, and unauthorized cross-border fund transfers.
By Reuters November 29, 2025, 7:43:44 PM IST (Published)
China’s central bank reiterated a hard line on virtual currencies on Saturday, flagging a recent uptick in speculation and pledging stricter measures against illegal activities tied to stablecoins.
At a coordinating meeting on virtual currency regulation on Friday, the People’s Bank of China (PBOC) said crypto speculation has risen recently due to various factors, creating new challenges for risk control. The central bank stressed that “virtual currencies do not hold the same legal status as fiat currency and cannot be used as legal tender in the market,” and described virtual-currency-related business activities as “illegal financial activities.”
The PBOC singled out stablecoins, saying many fail to meet customer identification and anti-money-laundering requirements. It warned these coins could be exploited for money laundering, fraud and unauthorized cross-border fund transfers, and said it would “intensify efforts to combat related illegal financial activities” to preserve economic and financial stability.
In October, PBOC Governor Pan Gongsheng said the bank would continue cracking down on domestic virtual-currency operations and speculation while closely tracking and assessing developments in overseas stablecoins. Hong Kong has created a regulatory framework for stablecoins but has not yet issued licences to issuers. Cryptocurrency trading has been banned across mainland China since 2021.
Despite the ban, bitcoin mining has been quietly reemerging in parts of China, with individual and corporate miners taking advantage of cheap power and a data-center buildout in some energy-rich provinces, miners and industry data say.
